Investment is an adventure with rewards waiting for the right decisions. As we traverse the second half of 2023, three intriguing stocks catch our eye. Spanning different industries, they possess a shared feature – they’re undervalued, yet they hold great growth potential. This has led to the rise of the most undervalued penny stocks.
This blend of a low present value with a high growth promise opens a door to potential profitability.Let’s now peel back the layers of their business models, gauge their performance, and sift through market trends. In doing so, we can see why these stocks could add significant value to your portfolio.
Staying abreast of market trends in the rapid world of investment is key. Spotting promising stocks early can pivot to profitable outcomes. So, let’s dive in and dig up these hidden investment gems together.
Diana Shipping (DSX)
Let’s embark on this voyage with Diana Shipping Inc. (NYSE:DSX), a leader in global dry bulk shipping. Their Q1 2023 financials show a net income of $22.7 million, marking a dip from the previous year. Nonetheless, they reported a rise in on-time charter revenue, reaching $72.6 million. Despite lower average charter rates, vessel acquisitions fuelled this growth, thus boosting days owned.
Apart from their financial report, Diana disclosed a dividend of $0.15 per share on common stock, payable around July 10, 2023. They’ve also upheld their dividend guidance for the next two quarters of 2023, aiming for at least $0.15 per share in dividends. This helps make it one of those most undervalued penny stocks.
Further enhancing their prospects, Diana has inked a time charter contract for the m/v DSI Altair with Western Bulk Carriers AS. This agreement is set to rake in $5.6 million in gross revenue, boasting a charter rate of $13,800 per day. The contract, at minimum, lasts until August 10, 2024, but has the potential for extension until October 10, 2024. The “DSI Altair,” a 2016-built 60,309 dwt Ultramax dry cargo vessel, fortifies this deal.
Through this all, Diana holds fast to its commitment to rewarding shareholders with dividends and keeps a close eye on its financial health. The recent time charter contract bolsters their earnings and reaffirms their stronghold in the dry bulk market.
Kingross Gold (KGC)
Kinross Gold Corporation (NYSE:KGC), a Canadian gold mining giant, comes next on our tour. Its Q1 financials announced a 23% jump in production from the previous year, amassing 466,022 gold equivalent ounces (eq. oz. Au).
Kinross boasted impressive production costs and margins, with costs of sales at $987 per eq. oz. Au sold and margins at $907 per eq. oz. Au sold. They amassed an operating cash flow of $259.0 million and reported net earnings of $90.2 million. All told, it ranks among the most undervalued penny stocks.
Record production months at the Tasiast and Paracatu mines were major victories, coupled with strong performance at La Coipa. Meanwhile, exploration in the Great Bear area yielded encouraging findings.
On top of their financial results, Kinross announced a $500 million debt offering of 6.250% senior notes due 2033. These notes, senior unsecured obligations, will be backed by certain wholly-owned subsidiaries. Expected to close on July 5, 2023, the offering’s net proceeds will be used to redeem all outstanding $500 million principal amount of Kinross’ 5.95% senior notes due 2024.
Kinross continues to reinforce its standing as a key player in the gold mining industry, demonstrating consistent operational success and financial growth.
EVgo (EVGO)
Our latest destination takes us to the electric vehicle charging sector with EVgo Inc. (NASDAQ:EVGO), a leading provider of electric vehicle charging solutions. Recently, the company released its Q1 2023 report, showing impressive financial growth and significant achievements.
The company reported first quarter revenue of $25.3 million, representing an incredible 229% increase compared to the same period last year. This revenue growth was driven primarily by increased freight and eXtend revenues. In addition, grid throughput reached 17.9 gigawatt-hours (GWh), a substantial 124% increase compared to the previous year.
EVgo’s success extends beyond its home market in California, with double-digit utilization achieved in several new markets. The company ended the first quarter with approximately 3,100 stations in operation or under construction, adding nearly 220 new stations during the quarter. EVgo’s customer base also experienced significant growth, adding more than 67,000 new customer accounts, bringing the total to approximately 614,000, a 63% increase over the prior year.
In addition to its financial performance, EVgo made notable partnerships and expansions during the first quarter. The company announced an expanded agreement with Chevron (NYSE:CVX), in which EVgo was selected as the preferred electric vehicle charging provider for Chevron and Texaco stations. This partnership aims to bring fast charging to conveniently located stations across the country, further enhancing the coverage and accessibility of EVgo’s network.
Also, EVgo unveiled plans to integrate North American Charging Standard (NACS) connectors into its fast charging network. This decision was prompted by recent announcements from major automakers Ford (NYSE:F) and General Motors (NYSE:GM) regarding the use of NACS starting in 2025. By incorporating NACS connectors, EVgo aims to accommodate a wider range of EV models and accelerate EV adoption rates.
As of this writing, Gabriel Osorio-Mazzilli 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.
