Roughly a month into 2023, it’s already clear that artificial intelligence (plenty of room to run throughout the coming months. But as momentum for this fast-growing tech continues to build, investors shouldn’t overlook the opportunities in AI penny stocks.) is this year’s first market boom. Since OpenAI launched ChatGPT, investors haven’t been able to ignore the power of this new tech. This has led to significant speculation around which stocks to buy as the AI boom takes off. Larger-cap stocks have been enjoying significant gains, with
This new market frenzy has generated some impressive gains for AI penny stocks. Smaller-cap companies are also well positioned to ride this wave right out of the penny stock category. As Markets Insider reports, names like BigBear.ai (NYSE:BBAI) and SoundHound (NASDAQ:SOUN) have both seen “bullish runs in recent months.” According to the outlet, in just January, “BigBear saw an increase of 356%, while SoundHound climbed 56%.”
BigBear is a key example here, recently rising above the $5 price point due to positive market momentum. But plenty of other companies in this space still trade below that line. They are well-positioned to climb in 2023. This doesn’t refer just to companies that produce AI tools and systems, but to firms that implement AI technology across a variety of sectors.
Let’s take a look at the AI penny stocks to watch as this next bull run continues to unfold.
AI Penny Stocks: Guardforce AI (GFAI)
If you want to see a penny stock surging on AI boom momentum, look no further than Guardforce AI (NASDAQ:GFAI). This dynamic firm leverages AI technology across a wide range of information and security solutions and provides consulting services. It has worked with a wide range of both private and public sector organizations and boasts a truly global reach.
GFAI stock has risen about 40% over the past five days and skyrocketed an impressive 125% year-to-date (YTD). At about 40 cents per share, it also still trades below the $1 mark. Considering that GFAI hovered around 16 cents last month, the progress here is hard to ignore.
Investors should regard GFAI stock’s low share price as a buying opportunity before the AI boom takes it even higher. The recent gains aren’t even all due to the current AI momentum. Less than a month ago, Guardforce secured two lucrative contracts, including a five-year deal with Don Muang Tollway Public Company. The second partner’s name has not been released.
Previously, Guardforce also saw shares rise after acquiring Shenzhen Intelligent Guardforce Robot Co. When it comes to AI penny stocks, GFAI is a clear choice for investors seeking market exposure from undiscovered winners.
SoundHound AI (SOUN)
This AI innovator is another winner this week. SoundHound has successfully ridden the current AI wave to impressive heights, rising 97% over the past five days. If anyone has doubts that the AI boom is here and creating a new class of market winners, they should take a look at this company’s impressive performance.
SOUN stock isn’t the only one in its field enjoying the current rally. But among AI penny stocks, it’s absolutely worth watching. Like Guardforce, SoundHound has given investors other reasons to bet on it. InvestorPlace contributor Chris MacDonald recently reported:
“The company pre-announced its 2022 results […] reporting revenues at the high end of its previous guidance. Additionally, the company announced the closing of an additional $25 million of preferred equity financing. SoundHound expects that this financing will help bolster its balance sheet, as the company looks to reduce debt as it cuts costs to the tune of $60 million per year.”
This type of catalyst is exactly what SOUN stock needs to keep investor interest high.
AI Penny Stocks: Ideanomics (IDEX)
This micro-cap name hasn’t been driven upward by the AI rally yet, but that doesn’t mean it can’t join the pack. Ideanomics (NASDAQ:IDEX) is recovering from a very difficult 2022. Still, investors do have some cause for optimism. Operating in the electric vehicle (EV) space, the company’s field will likely prioritize AI technology as EV makers and the like work toward perfecting autonomous vehicles.
Despite a difficult year, Ideanomics has been working hard to continue scaling operations and leveraging new technology. That includes implementing AI before the launch of ChatGPT. In October 2022, the company announced a three-year partnership with Alphabet’s (NASDAQ:GOOG, NASDAQ:GOOGL) Google Cloud to host its platform, “leveraging the AI and security features Google Cloud extends to its partners.” Per a statement released by the company:
“Built on Google Cloud, the platform will leverage Google Cloud’s advanced AI functionality to collect and analyze telematics from all Ideanomics products as well as third-party EVs and charging infrastructure.”
Predictive Oncology (POAI)
Medical AI darling Predictive Oncology (NASDAQ:POAI) is just starting to catch fire, but it looks poised to continue roaring. The company’s name does a good job of explaining what it does, chiefly applying AI technology to cancer treatment methods.
As InvestorPlace contributor Alex Sirois reports, Predictive Oncology has proven effective at identifying the best ways to treat different types of cancers and tumors. This gives it plenty of room to grow, as the need to find and strategically deploy cancer treatment methods won’t go away anytime soon.
Sirois also notes that Predictive Oncology has a “repository of data points 150,000 plus tumors by cancer type.” Cathie Wood recently highlighted the importance of extensive data for AI companies. While she applied this logic to her bullish case for Exact Sciences (NASDAQ:EXAS), a case could be made that Predictive may offer a similar opportunity.
AI Penny Stocks: Duos Technologies (DUOT)
This dynamic tech company technically just pushed above penny stock levels. Duos Technologies (NASDAQ:DUOT) currently trades at $5.42 per share. Like many AI penny stocks on this list, it’s enjoying the current rally; DUOT has jumped more than 170% over the past month.
Duos primarily deals in the production of automated inspection solutions for rail transportation vehicles. That’s a niche market but, as of now, operating in a specialized field is paying off well. DUOS stock is also up more than 150% year-to-date (YTD).
In late January 2023, Duos reported that its revenue base had grown through its AI and maintenance renewals. Prior to that, InvestorPlace contributor Muslim Farooque also reported that Duos had seen sales growth increase by “triple-digit margins” throughout previous quarters. As Farooque notes, the company has a strong financial profile and seems committed to continuing to drive growth through technology in significant demand. All this positions Duos to continue riding the new AI wave.
After being cast aside by plenty of investors, Remark (NASDAQ:MARK) is currently enjoying a massive second wind surge. Based in Las Vegas, the company “primarily focuses on the development and deployment of artificial intelligence-based solutions for businesses and software developers,” per Yahoo! Finance.
Remark saw some growth in 2021 due to attention from retail traders. But as InvestorPlace’s Louis Navellier noted, MARK stock had appeal beyond short squeeze potential. Over a year later, the new AI boom is proving Navellier correct.
Despite taking some heat from experts lately, Remark seems well-positioned to make up the ground it lost in 2022. Shares are up more than 70% YTD after surging more than 55% in the past month. Since last week, shares have been rising very steadily, showing no signs of slowing down. With interest in AI penny stocks growing, there’s no reason to suspect that MARK stock can’t climb further.
AI Penny Stocks: Rekor Systems (REKR)
“We build for cities, for citizens, and for life,” promises the Rekor Systems (NASDAQ:REKR) webpage. This company uses AI to provide analytical insights on vehicles and urban infrastructure. Rekor’s technology has applications not just for public safety on the road but for law enforcement and numerous commercial aspects. While REKR stock has been fairly volatile throughout 2023, it has overall performed well. Currently, REKR stock is up 30% for the month.
Rekor has done an impressive job leveraging AI for vehicle recognition tech at a time when need for this service should keep growing. As Muslim Farooque reports, “With [its] transition to a subscription model, Rekor Systems is likely to enjoy increased margins and recurring revenues, bringing even more impressive returns from its cutting-edge technologies.”
Farooque notes that Rekor is operating in a niche sector with significant growth potential. According to predictions from Grand View Research, the global market for transportation management systems has the potential to exceed $31.2 billion by 2030. The new interest in AI stocks should help REKR stock grow even more as it benefits from the boom.
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On the date of publication, Samuel O’Brient did not hold (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.