3 Penny Stocks That Can Still Double Before the End of 2023


  • These are the penny stocks to buy for 100% returns in the next few months.
  • Bitfarms (BITF): Strong fundamentals and continued growth in Bitcoin mining capacity.
  • Cronos Group (CRON): A strong cash buffer and a potential acquisition target.
  • Polestar Automotive (PSNY): EBITDA are losses likely to narrow and expecting significant delivery growth in 2024
penny stocks to buy - 3 Penny Stocks That Can Still Double Before the End of 2023

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The market year-to-date has been rewarding after the big correction witnessed last year. There are several growth and penny stocks that have bounced back strongly after being decimated last year. While some stocks trade at fair value or are overvalued, there are penny stocks to buy that trade at a valuation gap.

This column focuses on the non-speculative penny stocks to buy for 100% returns in the next few months. Of course, the rally depends on a few specific catalysts. If these factors play out, the rally in these penny stocks can be big.

I must add that these penny stocks to buy represent companies that are worth holding beyond the initial time horizon of few months. There is a strong case for multi-bagger returns from these stocks in the next 12 to 24 months.

Let’s discuss the reasons to be bullish on these penny stocks to buy.

Bitfarms (BITF)

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Bitfarms (NASDAQ:BITF) stock is among the penny stocks to buy that can skyrocket in the next few months. Even after the recent correction, BITF stock is higher by 169% year-to-date.

The Bitcoin (BTC-USD) miner is likely to surge if the cryptocurrency trends higher. I am bullish on Bitcoin with halving due in 2024. Further, a pause in rate hikes would be good news for risky asset classes. Even if Bitcoin trades at $35,000 by December, BITF stock is likely to double from current levels.

Specific to Bitfarms, mining capacity was 2.2EH/s as of July 2021. By the end of the year, the company expects to boost mining capacity to 6EH/s. This will translate into strong revenue and cash flow growth once Bitcoin trends higher.

It’s also worth noting that Bitfarms has reduced debt from $165 million in June to below $12 million. The massive deleveraging provides the company with high flexibility for the next leg of growth investments.

Cronos Group (CRON)

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In the last month, Cronos (NASDAQ:CRON) stock has trended higher by 17%. This seems like a reversal rally from deeply oversold levels. I would not be surprised if CRON stock doubled in the next three months.

Talking about undervaluation, Cronos reported cash and equivalents of $841 million as of Q2 2023. The Company currently commands a market valuation of $861 million. Clearly, CRON stock has significant upside potential.

It’s also worth noting that business developments remain positive. Recently, the company launched its medicinal cannabis brand in Germany. The outlook for medicinal cannabis is promising in Europe and Cronos is likely to benefit. Cronos has focused on cost-cutting and the company expects to improve cash flows in the coming quarters. This is another potential catalyst for CRON stock rally.

In July, Cronos had reported that the company received unsolicited indications of interest. A potential merger or acquisition news can possibly trigger significant price action considering the level of undervaluation.

Polestar Automotive (PSNY)

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Polestar Automotive (NASDAQ:PSNY) stock has plunged by 51% for year-to-date. I believe that the correction in PSNY stock is overdone and a big rally is impending.

It’s important to understand that the EV maker lowered its guidance for 2023 deliveries. Further, EBITDA level losses have been sustained and equity dilution is on the cards. These factors have depressed PSNY stock.

I however believe that the worst is over with several positives on the horizon. First, Polestar has undertaken cost-cutting measures that include a reduction of headcount and an enhancement of operational efficiency. It’s likely that EBITDA level losses will narrow in the coming quarters.

Further, Polestar 3 and Polestar 4 production is due in the next few months. These two new models are likely to boost delivery growth in 2024 and 2025. The continued stock sell-off therefore seems unjustified even if the equity dilution factor is considered.

On the date of publication, Faisal Humayun 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

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