ASX Penny Stocks To Watch In October 2026

As the Australian share market prepares to open with mixed signals from futures, investor sentiment remains cautious amid concerns about rising bond yields and geopolitical tensions. Despite these uncertainties, penny stocks—often representing smaller or newer companies—continue to capture the interest of investors seeking unique opportunities. These stocks, while traditionally seen as speculative, can offer surprising value when backed by strong financials and resilience.

Underneath we present a selection of stocks filtered out by our screen.

Mesoblast (ASX:MSB)

Simply Wall St Financial Health Rating: ★★★★☆☆

Overview: Mesoblast Limited, along with its subsidiaries, focuses on developing regenerative medicine products in Australia and has a market cap of A$2.60 billion.

Operations: The company generates revenue of $120.25 million from the development and commercialization of its allogeneic cellular medicines platform.

Market Cap: A$2.6B

Mesoblast Limited, with a market cap of A$2.60 billion, has shown significant revenue growth to US$120.25 million in the past year despite being unprofitable. Recent FDA approval for its T-cell Proliferation Inhibition BioAssay (TIBA) enhances the quality control of Ryoncil, its FDA-approved product for SR-aGvHD. The company is advancing its Phase 3 trial for rexlemestrocel-L targeting chronic low back pain, a potential blockbuster indication with peak year revenue exceeding US$10 billion at single-digit market penetration. Mesoblast's financial health includes satisfactory debt levels and sufficient cash runway beyond a year based on current free cash flow.

• Take a closer look at Mesoblast's potential here in our financial health report.
• Gain insights into Mesoblast's future direction by reviewing our growth report.

St Barbara (ASX:SBM)

Simply Wall St Financial Health Rating: ★★★★★★

Overview: St Barbara Limited, along with its subsidiaries, is involved in the exploration, development, mining, and sale of gold with a market capitalization of A$955.74 million.

Operations: The company's revenue segment includes its Atlantic operations, which generated A$3.63 million.

Market Cap: A$955.74M

St Barbara Limited, with a market cap of A$955.74 million, faces challenges as a penny stock due to its unprofitability and limited revenue generation of A$3.63 million from Atlantic operations. Despite this, the company has no debt and maintains strong short-term financial health, with assets exceeding liabilities significantly. Earnings have shown improvement over five years by reducing losses at 33.9% annually, though return on equity remains negative at -2.99%. The company announced a cash dividend of A$0.05 per share for the six months ended June 2026; however, sustainability concerns persist due to insufficient earnings coverage.

• Click here to discover the nuances of St Barbara with our detailed analytical financial health report.
• Evaluate St Barbara's prospects by accessing our earnings growth report.

Victory Metals (ASX:VTM)

Simply Wall St Financial Health Rating: ★★★★★★

Overview: Victory Metals Limited is involved in the exploration and development of mineral properties in Australia, with a market cap of A$182.42 million.

Operations: The company's revenue is primarily generated from its Engineering Services segment, amounting to A$0.41 million.

Market Cap: A$182.42M

Victory Metals Limited, with a market cap of A$182.42 million, is pre-revenue and currently unprofitable, reporting a net loss of A$5.11 million for the year ended June 2026. Despite its financial challenges, the company benefits from being debt-free and has strong liquidity, with short-term assets totaling A$11.5 million against liabilities of just A$1.3 million. The board is experienced with an average tenure of 5.3 years, providing some stability in governance. Recently added to the S&P/ASX All Ordinaries Index in September 2026, Victory Metals remains a speculative investment within the penny stock landscape in Australia.

• Dive into the specifics of Victory Metals here with our thorough balance sheet health report.
• Gain insights into Victory Metals' historical outcomes by reviewing our past performance report.

Summing It All Up

• Jump into our full catalog of 408 ASX Penny Stocks here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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