- Seanergy Maritime Holdings (SHIP): Dry bulk goods shipper with rising share price and growing fleet.
- Charah Solutions (CHRA): 50% upside in coal plant remediation stock.
- Lipocine (LPCN): Lipocine is a biotech approaching breakeven and has a major catalyst ahead in the coming days.
- FGI Industries (FGI): FGI is an early home furnishings stock with massive partners.
- Profire Energy (PFIE): This fundamentally strong oil and gas play improves economic efficiency and saves lives.
- Capricor Therapeutics (CAPR): A biotech with a massive milestone payout ahead and Covid-19 potential.
- Vista Gold (VGZ): Potential 100% upside in an attractive commodity play.
It isn’t difficult to find penny stocks with major upside if you measure upside based on current price and target price. As an example, it’s very easy to find multiple stocks trading for below $1 that have target prices above $10. We can then say that they have 10X potential.
In other words, we can call any stock trading below its target price “undervalued.” And by that definition, it’s very easy to find undervalued penny stocks with major upside. The issue here is that many, if not all of those stocks will have lost money for investors.
That is what separates the stocks on this list: They have momentum as well as major upside. At the time of writing, all of the shares listed in this article have produced gains year-to-date. On top of that, they also have plenty of room between current prices and target prices. Let’s get into what makes them special.
|SHIP||Seanergy Maritime Holdings||$1.13|
Undervalued Penny Stocks: Seanergy Maritime Holdings (SHIP)
Seanergy Maritime Holdings (NASDAQ:SHIP) is a name that might make you think of a company in the energy business. But Seanergy Maritime Holdings operates in the dry bulk commodity shipping business.
That has been a positive for the firm in 2022. Share prices have risen from 92 cents to $1.13 as of its March 29 opening. That equates to roughly 24% price appreciation year-to-date. The good news is that the momentum could continue based on its consensus target price of $1.88. Investors lucky enough to have bought in at the beginning of 2022 could see their investments double if those targets are reached.
And the reason to believe that might occur isn’t that hard to understand when viewing the firm’s improvement in 2021. Its revenues more than doubled in 2021, reaching $153 million. That resulted in a net gain of $41 million where the company posted an $18 million net loss in 2020. The company is the only Capesize pure-play ship owner listed in the U.S. and increased its fleet to include 17 ships in 2021, up from 10 in 2020.
Charah Solutions (CHRA)
Charah Solutions (NYSE:CHRA) stock has a few things going in its favor. For one, its share price is up around 6% so far in 2022. It is going in the right direction and has already moved close to $6 to begin 2022 in rapid fashion. It certainly has the potential to rise quickly. The two analysts covering Charah Solution with price targets both rate it a “buy” and together give it a consensus price of $7.50. That indicates a 50% upside from current prices.
Charah Solutions operates in an industry that could garner much more attention in the near future. The company bills itself as a leading provider of environmental services and byproduct sales to the power generation industry.
One of the more interesting aspects of its business is the recycling of ash byproducts generated from the combustion of coal for electricity generation. The company creates specification-grade fly ash from coal which is then used in so-called green concrete. It has been able to create momentum in 2021, which has raised revenues and brought the company closer to a breakeven point. That has share prices moving upward and the 50% upside makes it attractive.
Undervalued Penny Stocks: Lipocine (LPCN)
Lipocine (NASDAQ:LPCN) stock represents a biotech firm that has made major steps in the right direction. In all of 2020, the firm recorded no revenue whatsoever. Biotech involves significant upfront costs, and to no one’s surprise, Lipocine was no different. The firm racked up nearly $18 million in operating expenses during 2020, leading to a net loss of $21 million.
In 2021 the story was different: Lipocine recorded $16 million in revenues which led to a much smaller net loss of $634,000.
Lipocine’s pipeline includes drugs indicated for women’s health, liver disease and testosterone replacement therapy (TRT). It is that last category that should have investors particularly interested. TLANDO, a TRT drug, received approval from the U.S. Food and Drug Administration on March 29 with commercial launch anticipated for Q2.
Analyst consensus prices indicate that LPCN stock should trade at $3.75 with a high price of $6.
FGI Industries (FGI)
FGI Industries (NASDAQ:FGI) is a 35-year-old firm whose stock went public in late January of this year. It began business by importing wood cabinets and bathroom fixtures for the retail market. It now focuses on the B2B side of sanitaryware (toilets and sinks), bath furniture, shower systems, cabinetry and accessories.
Until recently, FGI stock was trading above IPO levels. Although it has been a bumpy ride, FGI shares returned roughly 11.5% on March 24 before falling in subsequent sessions. The good news is that the target price sits at $7.75. That implies significant upside of 158% moving forward.
FGI Industries operates in the quiet home furnishings industry. That isn’t exactly an attractive industry to be in. But the company boasts an impressive customer base that includes Walmart (NYSE:WMT), Costco (NASDAQ:COST), Home Depot (NYSE:HD) and Lowe’s (NYSE:LOW).
Undervalued Penny Stocks: Profire Energy (PFIE)
The primary business of Profire Energy (NASDAQ:PFIE) is burner management systems for the oil and gas industry. The stock has a chance for obvious reasons. A burner management system adds value by assuming much of the risk a human worker otherwise would. Those burners exist at multiple points in the transport of oil and gas within upstream, midstream and downstream points.
It reignites an extinguished flame more rapidly and safely than a human worker can do in the field. Burner Management Systems also reduce emissions by quickly reigniting a failed flame. In essence, burner management systems including those from Profire Energy reduce costs while improving safety and emissions.
Profire Energy saw revenues increase 23% in 2021, reaching $26.4 million. The company is strong from an operational perspective and posted a gross profit of $11.4 million. However, it still reported a net loss of $1.1 million in 2021. A renewed push toward domestic production could propel it upward through the rest of 2022.
Capricor Therapeutics (CAPR)
Most agree that penny stocks are defined as those that trade for under $5 per share. Capricor Therapeutics (NASDAQ:CAPR) spent a few days above that threshold but has since fallen. Let’s give it the benefit of the doubt, because it has tremendous upside and momentum. At its peak on March 25, CAPR stock had appreciated 67% to reach a $5.68 share price. It has since fallen down to $3.82, around 3% higher this year. The 2 analysts covering the equity give it a target price of $12 and $18, respectively. That implies an average upside of 329%.
The reason to be interested in CAPR stock is its CAP-1002 therapeutics. CAP-1002 is a cardiac-derived cell therapy that has the potential to encourage cellular regeneration. CAP-1002 is being investigated in phase-3 for use against Duchenne muscular dystrophy and in phase-2 for use against Covid-19.
It is a typical biotech stock in the sense that it continues to experience increasing losses. Those losses reached $20 million in 2021. But the Duchenne muscular dystrophy trials could lead to $705 million in additional milestone payments.
Undervalued Penny Stocks: Vista Gold (VGZ)
Vista Gold (NYSEAMERICAN:VGZ) stock has the potential to roughly double based on analyst estimates. The three analysts with coverage believe it should trade at $2.17 while it currently trades at $1.03.
It has already appreciated substantially in 2022, having risen from 72 cents to above $1. The reason to believe in Vista Gold’s upside relates to a recent increase in its proven reserves.
A feasibility study released in February showed a 19% increase in proven and probable mineral reserves. That means there are now 6.98 million ounces of gold at its disposal. That should result in average annual production of 479,000 ounces of commercial production during the first seven years of commercial production.
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On the date of publication, Alex Sirois 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.