Penny stocks have sprung into focus with the rise of meme stock trading. Penny stocks have shown a lot of bullish action in the past few months. The market has been volatile, but overall, investors are hopeful about the future. A lot of it can be attributed to the positive updates concerning the pandemic.
There are purely speculative penny stocks, while there are some with strong outlooks and fundamentals. Therefore, it’s imperative to choose wisely in adding value to your portfolio with penny stocks.
There have been several positive developments concerning the pandemic. In the U.S., Covid-19 has declined rapidly in the past few months. This is mainly due to millions of vaccine doses that have been distributed. As a result, economic experts believe that the economy could rebound in the coming months. Factors such as low employment numbers and solid retail figures suggest that the future is bright. As a result, several penny stocks have been increasing in value.
This list covers seven of the most promising penny stocks trading under a dollar at the time of writing:
- Cyren (NASDAQ:CYRN)
- Oragenics (NYSEAMERICAN:OGEN)
- Great Panther Mining (NYSEAMERICAN:GPL)
- Evofem Biosciences (NASDAQ:EVFM)
- Gran Tierra Energy (NYSEAMERICAN:GTE)
- Zomedica (NYSEAMERICAN:ZOM)
- Gold Standard Ventures (NYSE:GSV)
Penny Stocks to Buy: Cyren (CYRN)
Cyren is a small-cap cybersecurity company operating as a software as a service company. It focuses on threat intelligence and email security services. Despite its minuscule size in its industry, it has a customer base that includes heavy hitters like Microsoft (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL). However, from a fundamentals perspective, it isn’t nearly as eye-catching as its peers, but it has a substantial growth runway ahead, making CYRN a worthwhile bet.
Earnings results have largely been underwhelming, but it has a few growth initiatives resulting in expansion as we advance. One such product is Cyren Inbox Security, a cloud-based email security offering that provides automated response and remediation for various security threats. Revenues from the product nearly tripled from the second quarter in 2020. Moreover, the company added several new midsized and large enterprises to its customer base in its most recent quarter.
Oragenics is small-size development-stage biotech, which develops therapeutics for infectious diseases. It currently has two pre-IND therapeutics in its product pipeline, which hopes could change its fortunes. These products aim to combat infectious diseases such as C. difficile and Covid-19 and could be massive money-spinners for OGEN stock.
The company is in a relatively secure financial position, with its cash reserves at $36.5 million as of the first quarter this year. It doesn’t expect meaningful revenues before 2024, though, and outlines an expected cash burn of $28 million through the second quarter of 2022. Therefore, it would need funding at some stage in the next year to see its projects past the finish line. IND’s for both its pre-IND therapeutics will be submitted in the fourth quarter this year. Hence, there’s a lot to look forward to with OGEN stock this year.
Penny Stocks to Buy: Great Panther Mining (GPL)
Canadian Gold Miner, Great Panther Mining had been posting triple-digit revenue growth numbers before the pandemic kicked in. Naturally, the pandemic has pushed it back several steps by creating cost issues, lowering reserves and delaying its projects. Despite its shortcomings, GPL stock is a gold-mining play that can rebound in the coming months and trades at under two times forward sales.
In its first quarter, the company did well to expand its margins and fortify its balance sheet. It reduced its debt position by a massive $27.6 million, ending the quarter with over $40 million in cash. Moreover, its net loss was at $0.3 million compared to $40.5 million in the first quarter of 2020. However, gold production has dropped considerably in its Tucano mine and its silver operations in Topia and GMC. Things are a bit dicey with the company, but you can afford to be a little speculative with GPL stock, given its throw-away price.
Evofem Biosciences (EVFM)
Evofem is a biopharma company involved in the development and commercialization of products that cater to the unmet needs in women’s reproductive health. Its core product is called Phexxi, which is a vaginal gel used to prevent pregnancy. The product has a market of over $1 billion in the U.S., with plenty of room to grow and power EVFM stock in the future.
The company is also working on a product called the EVO100. It’s essentially an antimicrobial vaginal gel to prevent Chlamydia trachomatis and Neisseria gonorrhoeae infections in women. If everything goes according to plan, it would be available for sale by 2024. In the meantime, Evofem will continue to win big with Phexxi and expand to other countries.
Penny Stocks to Buy: Gran Tierra Energy (GTE)
Gran Tierra is an intermediate oil producer and explorer that has struggled to unlock value for investors for years. Reasons for this include its massive debt load, weak oil prices, and ineffective merger and acquisition activity. The pandemic-ridden year 2020 didn’t do it any favors either, as oil prices tanked to historic lows. However, the outlook is becoming increasingly positive for crude oil, leading to higher Brent pricing and a considerable upside for GTE stock.
Outlook for the Brent price has improved drastically this year. Investment bank Goldman Sachs predicts that Brent could potentially hit $80 per barrel during the summer. The bullishness, supported by vaccine rollout and the expanding U.S. economic recovery, saw Brent gain a massive 70%. Moreover, with improvements in the political climate in Columbia, Gran Tierra will not only meet its budget targets but could exceed its guidance this year.
Zomedica is a small-cap biopharma company that aims to be a disruptor in animal healthcare diagnostics. It launched its first product called Truforma, a veterinary diagnostic tool that can perform five diagnostic tests for adrenal and thyroid conditions in cats and dogs. Although it hasn’t generated any meaningful sales yet, ZOM stock has quite the potential to grow immensely in the future.
The veterinary diagnostics field alone is an industry and can grow over 9.4% to $3.9 billion on an annual basis through 2026. Hence, if the company can gain only a fraction of this market, it would be looking at massive revenues down the road. It’s an incredible tool for veterinarians and can potentially gain substantial traction in the foreseeable future.
Penny Stocks to Buy: Gold Standard Ventures (GSV)
Gold Standard Ventures has been one of the worst-performing gold stocks in the past year. This is surprising considering its ownership of a sizeable land package in Nevada. The package is home to 2.75 million ounces of gold with an average grade of just one gram per gold ton.
However, several developments have been off-late, which could point to a remarkable upside for GSV stock. The company has recently had a major management shake-up and capital raises to bolster its treasury. Hence, these developments could potentially lift its stock which is trading at an insanely low price.
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.