Penny stocks haven’t been too hot recently. With high volatility in the market and a slowdown in meme stocks, several of these low-priced trades have fallen out of favor. However, that’s not the case with all penny stocks; there are plenty that are still worth rolling the dice on.
For growth stocks, the coming months are going to be a challenge. Several economic experts have predicted an increase in interest rates in the coming year, which will negatively impact these shares.
Nevertheless, multiple low-priced stocks have catalysts in play and could take advantage of the macroeconomic conditions. For example, small-cap companies with sizeable exposure to rising commodity prices could perform remarkably well.
These growth drivers can outweigh many of the problems facing small and midsized enterprises at this time. Moreover, it could enable their shares to speed past penny stock territory.
Having said that, let’s look at these six penny stocks trading below the $1 mark with plenty of upside potential:
- Advaxis (NASDAQ:ADXS)
- Red White & Bloom (OTCMKTS:RWBYF)
- Zomedica Pharmaceuticals (NYSEMKT:ZOM)
- Parks! America (OTCMKTS:PRKA)
- Surgalign (NASDAQ:SRGA)
- Magna Gold Corp (OTCMKTS: MGLQF)
Penny Stocks: Advaxis (ADXS)
Advaxis is small-cap clinical-stage biotech company that develops therapeutics for its cutting-edge attenuated delivery products. It has a promising product pipeline, which includes three therapeutic programs in various trial stages.
These products are being developed to treat prostate, metastatic prostate and non-small cell lung cancers. Progress has been impressive so far, with its programs on track to swiftly reach advanced clinical stages.
The company recently released its third-quarter results, which showed $45.3 million in cash and equivalents — a healthy 79.7% improvement compared to last year. Moreover, it cut its operating expenses by an extraordinary 25%.
On top of that, the company has laid out its highly ambitious plans for the next 12 to 18 months, which makes ADXS a fascinating bet.
Red White & Bloom (RWBYF)
Canada-based cannabis operator Red White & Bloom has been a solid performer in the past year. With its plans to expand into U.S. markets with operations in Michigan, Florida and Illinois, it should increase its top line aggressively in the coming years.
Based on its growth potential, RWBYF stock is incredibly cheap and can explode in the future.
Red White & Bloom recently posted its second-quarter results, where its revenue increased by 13% to $13.3 million. Its adjusted sales for the quarter reached $58.5 million. Moreover, it reduced its short-term obligations by roughly $18 million.
Looking ahead, Red White & Bloom plans to open multiple dispensaries across Michigan and Florida. Both markets have been growing in terms of cannabis sales, with Michigan’s alone reaching $3.2 billion last year. Hence, the company is an attractive bet at current levels.
Penny Stocks: Zomedica Pharmaceuticals (ZOM)
Zomedica aims to become a disruptor in the highly competitive yet rewarding veterinary diagnostics field. It released its veterinary diagnostic tool called Truforma back in March.
Its revenues have been underwhelming so far, but it’s still the early days in Zomedica’s operations. Moreover, it is operating in a $2.5 billion global industry which could grow by 9.4% on an annual basis between now and 2026.
Zomedica is looking to ramp up sales in the latter half of the year and beyond with the release of new assays for Truforma. The company has also launched a customer appreciation program to increase the presence of the Truforma brand.
Finally, Zomedica also acquired Pulse Veterinary Technologies, which offers its patented technology for the treatment of several conditions in veterinary patients. With these positive factors at play, ZOM stock can pick up the pace by the end of this year, in line with the expected increase in Truforma sales.
Parks! America (PRKA)
Parks! America is a small but thriving enterprise that operates three profitable wild animal-themed safari parks in three different states. It has locations in Pine Mountain, Georgia; Strafford, Missouri and Bryan, Texas.
The business has a solid track record of growth over the last decade, maintaining a pristine balance sheet and a cheap valuation.
Financial results have been stellar so far this year. For the nine months ended in July 2021, the company’s revenues rose 73% from the prior-year period to $8.58 million. Moreover, its income from operations in the same nine-month period grew by an astonishing 91% to $2.7 million.
With its management’s plans to expand its revenue base through new acquisitions and improvements to its existing parks, expect PRKA to offer substantial returns in the future.
Penny Stocks: Surgalign (SRGA)
Surgalign is a medical device company that plans to disrupt the fast-evolving digital surgery industry. It is targeting the spinal surgery space once it receives the regulatory green-light for its Holo Surgical platform in the fourth quarter.
Moreover, it has already laid down plans to expand beyond the spine sector and embrace a Software-as-a-Service (SaaS) business model, boasting gross margins over 70%.
It recently posted its second-quarter results, which comfortably beat analyst estimates. The company’s revenue of $24.8 million represents a 20.9% increase from the prior-year period.
However, due to certain quality and regulatory roadblocks, Surgalign had to reduce its 2021 revenue guidance. Nevertheless, it is gross margin was excellent at 71%, with about $70 million in cash and equivalents at the end of the second quarter.
Surgalign has an enormous opportunity ahead, as the total addressable market for just spinal implants and surgery devices is at a whopping $10 billion. Grabbing a small fraction of that market share is likely to skyrocket SRGA stock.
Magna Gold Corp (MGLQF)
Magna is a Canada-based gold miner that enjoys 100% ownership in its San Francisco Gold Project, covering an area of more than 47,000 hectares.
Its San Francisco mine is up and running, and it expects a run-rate of more than 7,000 ounces of gold per month by the end of this year. Moreover, it has assembled multiple exploration properties in Sonora and Chihuahua, Mexico.
The long-term goal is for its San Francisco operation is to reach a capacity of 100,000 ounces per year, delivering beyond its pre-feasibility study. Magna is aiming to become an intermediate precious metal producer within the next three years by achieving 200,000 ounces per year in total production. This points to a potential for substantial upside in MGLQF stock.
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
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.