Penny stocks often offer tremendous upside for investors. As a result, they also expose investors to significant risk as well. One of the highest risk-to-reward subsectors of penny stocks is biotech. It offers dozens of get-rich-quick opportunities that are ultimately all predicated on FDA approval. Most fail. This list includes zero biotech firms, but also offers double-your-money potential across various other high-growth sectors.
The companies below represent a wide variety of industries and sectors overall. Each stock also offers 100% upside based on analyst prices. Accordingly, for investors seeking penny stocks with double-up potential, these listed firms outside of biotech warrant closer examination.
|RNW||ReNew Energy Global||$5.68|
Latch (NASDAQ:LTCH) offers enterprise SaaS security solutions to building operators. In other words, LTCH stock is an investment in security software for large building operators. Just as the market for energy-efficient buildings is growing, so too is the market for building security.
That has been a boon to Latch, which recently released strong earnings at the beginning of this month. Those results are very encouraging for investors looking for up-and-coming penny stock growth opportunities.
Software revenue increased by 88% to $3.0 million in the first quarter. Total revenue grew even faster during the period, up 106%, reaching $13.7 million. And annual recurring revenue, very important to software firms, increased by 137%. These numbers should go a long way in allowing Latch to provide predictable future revenues, which is particularly important to SaaS investors.
As the Federal Reserve reduces its pace of interest rate hikes, growth firms like Latch, which suffered greatly in 2022, are expected to face fewer challenges (despite ongoing losses). That makes LTCH stock one to consider for around $1 per share.
Cemex SAB (CXMSF)
Cemex SAB (OTCMKTS:CXMSF) offers potential rewards with its current price of $0.65 and an average target price of $13.09, but it comes with higher risk. The cement giant hasn’t traded above $1 since 2014, so it’s difficult to say exactly why there’s such enthusiasm on the part of Wall Street.
One reason may be the $3.2 million award given to the company by the Department of Energy in February. That award subsidizes research at Solar MEAD being led by Cemex. The research aims to decarbonize the key component of cement production called clinker.
The joint project between Cemex, Sandia National Laboratories, and Synhelion has resulted in a method of producing cement without fossil fuels. Meanwhile, Cemex’s revenues increased by 8% in the most recent quarter. Those strong results, combined with the development of what may become breakthrough technology, could catalyze Cemex’s share prices much higher should commercial sales spike.
ReNew Energy Global (RNW)
ReNew Energy Global (NASDAQ:RNW) is a really interesting stock because of a few factors. The Indian company develops, owns, and operates solar power projects in one of the highest-potential markets in the world with vast quantities of sunshine for capture. In 2022, India installed a record volume of solar power panels. It’s a truly promising geography for solar given India’s smog issues and high levels of sunshine.
ReNew Energy Global is also relatively established, with a share price above $5. But it isn’t only a solar energy producer. The company is also a wind energy powerhouse that supplies Indian utility firms.
ReNew Energy Global saw revenue growth of 20% in both the most recent quarter and in 2022 overall. Its production portfolio increased by 30.4% to 13.4 gigawatts. In short, the company is growing and India looks to be a real bright spot for renewable investment moving forward. Thus, RNW offers real potential without excessive risk.
Blue Apron (APRN)
Blue Apron (NYSE:APRN) is a reasonably well-known meal delivery firm that should soon be much closer to profitability. That makes its sub-$1 stock one to consider as its target price is near 5-times as high.
Blue Apron has been undergoing a pivot toward efficiency with the goal of profitability in mind for some time. The company essentially halved its marketing spend in the first quarter. That decision was made to slow the company’s bleeding around its cash position. This strategy worked, as Blue Apron’s overall net loss fell from $38 million to $17 million. Meanwhile, revenues only declined by 4%.
Blue Apron had been pivoting with a bigger strategy in mind. A week later, the company announced plans to transfer its operational infrastructure to FreshRealm. FreshRealm will essentially be running the entirety of Blue Apron’s production moving forward. The company had previously produced Blue Apron’s heat-to-eat line. So, Blue Apron must believe that FreshRealm is capable of better operating production for its business.
Blue Apron doesn’t expect sales to suffer and if profitability comes soon, APRN stock will provide strong returns for investors.
Lion Electric (LEV)
Lion Electric (NYSE:LEV) is a very solid EV stock to consider for penny stock enthusiasts. The Montreal-based medium- and heavy-duty vehicle producer currently has 1,100 vehicles on the road which have driven over a collective 10 million miles.
While those statistics are interesting, it’s Lion Electric’s strong growth paired with minimal losses that is really attractive.
Lion Electric delivered 220 vehicles in the first quarter of 2023. That represented an increase of 161% over the 84 vehicles delivered a year earlier. As a result, revenues increased 142% to $54.7 million. Lion Electric did post a loss of $15.6 million, largely related to warrant obligations that benefitted the company a year earlier.
Essentially, Lion Electric is an EV bus firm with buses representing 2,270 of the 2,565 vehicles in its order book. That includes both charter and school buses, giving the company strong growth prospects ahead.
Canaan (NASDAQ:CAN) stock has the potential to double based on target prices. The company provides ASIC Bitcoin miners which are purpose-built to mine Bitcoin (BTC-USD).
I won’t bore you with detailed numbers, but overall Canaan is heading in the wrong direction. Revenues, computing power sold, and mining revenue all fell per the most recent earnings report.
But there’s a big caveat worth understanding. Those numbers are for the 3- and 12-month periods ended December 31, 2022. Bitcoin prices skyrocketed beginning in early January of this year. In other words, the most recent earnings report doesn’t account for Canaan’s Q1 results, which ostensibly should be strong.
It stands to reason that sales should have been much, much better during the first quarter. Companies and individuals should have been scrambling to secure Bitcoin miners, making Canaan relevant again. The funny thing is that CAN stock didn’t really move that much.
Valens Semiconductor (VLN)
Valens Semiconductor (NYSE:VLN) serves the automotive and audio-video industries in the long-range connectivity, low-cost segment. The chip provider’s most obvious opportunity is in continuing to serve the automotive industry, which continues to grow in the number and complexity of sensors required for each vehicle.
Particularly positive news for investors is that Valens Semiconductor exceeded the high end of revenue, gross margin, and EBITDA guidance in the first quarter. Revenues grew by 10.5% to $23.9 million. Likewise, gross margin figures and EBITDA were better than anticipated.
Valens Semiconductor anticipates revenues to be largely unchanged in the second quarter, and 2023 sales to come in between $97 to $100 million. The company has substantial relationships with Mercedes Benz, Continental, Molex, Harman, Molex, and Bosch. The automotive sensor market is expected to grow at 35% annually through 2026. The company also expects growth in the video conferencing market, which will allow it to continue to expand and approach break-even.
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Read More: Penny Stocks — How to Profit Without Getting Scammed
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.
Consumer Discretionary, Automotive, Electric Vehicles, Energy, Renewable Energy, Semiconductor, Technology