As economic and stock market uncertainty looms, you may think at first that now is not a great time to be dabbling in speculative stocks.
Yet, while the broad market may be experiencing turbulence right now, there are several stocks benefiting from company-specific catalysts that outweigh the macro issues.
Not only that, there are stocks that, while knocked lower by the near-term volatility, have high exposure to long-term growth trends that give them a strong chance of delivering strong returns relative to current prices.
These are not “bet the ranch” type of plays. These are for the risk-tolerant only, and even then, these investors should proceed with caution, by making these small positions in their portfolios.
However, if you fit this investor type description, and are on the search for high-risk, high-reward opportunities, consider taking a look at these seven speculative stocks.
Crinetics Pharmaceuticals (CRNX)
Admittedly, it may seem like it’s too late to buy Crinetics Pharmaceuticals (NASDAQ:CRNX) before it explodes higher. In recent weeks, shares in this clinical stage biotechnology firm have done just that.
After the company reported strong Phase 3 trial data for its key drug candidate, paltusotine on Sept. 11, CRNX stock spiked more than 63%, rallying further the next trading day.
Since making this bolt higher, shares have leveled off. An announced secondary stock offering, dilutive to existing investors, also calls into question whether the stock has more to run from here.
I wouldn’t expect the next big rally for CRNX to arrive immediately. Given the commercial potential of paltusotine (a treatment for growth hormone disorder acromegaly), though, if this treatment makes it through the pipeline, there’s plenty more upside potential.
Per Evercore ISI’s Gavin Clark-Gartner, paltusotine could reach $500 million in peak U.S. annual sales.
Denison Mines (DNN)
Over the past six months, shares in this Canada-based uranium miner have surged by around 71.6%.
Given how well DNN stock and similar names have performed over such a short time frame, it could seem like uranium stocks are amid a bubble waiting to pop.
However, while there is some speculative frenzy at play, this “melt up” is being driven by a substantive catalyst: the resurgence in popularity of nuclear power.
According to analysts, uranium prices have room to run, as the world embraces nuclear power’s merits as a clean energy source.
This in turns bodes well for Denison Mines, a greater use of nuclear power means more demand for uranium, and greater upside potential for the company’s Wheeler River uranium project.
Investors have waited quite a long time for Globalstar’s (NYSEAMERICAN:GSAT) bright future to arrive.
The mobile satellite services company has a substantial amount of commercialization potential, but it has taken longer than expected to tap into said potential.
Shares have fallen by around 26.8% over the past twelve months. However, after a poor stock price performance, the ingredients may be in place for GSAT to experience another big run.
As InvestorPlace’s Josh Enomoto argued on Aug. 29, with a new CEO (former Qualcomm CEO Paul Jacobs) at the helm, and new focus on the $2.5 billion (and growing) private network infrastructure market, Globalstar may finally fully capitalize on its spectrum assets.
Lithium Americas (LAC)
The Canada-based lithium miner is still at the pre-revenue exploration stage, yet there is substantial potential with its mining projects.
For instance, consider LAC’s Thacker Pass mining project, in Nevada. Based upon its lithium reserves, Lithium Americas estimates this project has a net present value of $4.95 billion. Impressive, given that LAC stock has a market cap of $2.74 billion at current prices.
Better yet, as I discussed last month, the company has just discovered the world’s largest lithium deposit, within the McDermitt Caldera (an ancient volcano).
Whereas Thacker Pass has 3.7 million metric tons of lithium, the McDermitt Caldera discovery could contain five to ten times that figure. While very speculative and very volatile, this potential makes LAC worthy of a closer look.
Pagaya Technologies (PGY)
Pagaya Technologies (NASDAQ:PGY) was a victim of the “SPAC wipeout” during 2022, yet in 2023, it’s been one of the speculative stocks investors have warmed back up to.
Shares in this fintech, which uses AI-driven models to originate loans, have bounced back by around 43.6% since January.
PGY stock, after climbing from around $1 to as much as $2.83 per share, has pulled back more recently. If you think that means this stock merely experienced a “dead cat bounce,” and is heading lower, consider changing your view.
As UPST has a market cap ($2.3 billion) double that of PGY ($1.12 billion), there may just well be plenty more room for shares to run from here.
Solid Power (SLDP)
However, I am bullish on one of QS’s main publicly-traded rivals, Solid Power (NASDAQ:SLDP).
Why do I think SLDP stock is one of the best speculative stocks, while QS is a speculative wager not worth making? On the surface, both companies seem very similar.
Both are still at the development stage, consuming far more cash than they are currently bringing it.
Reaching only a modicum of success could drive big gains for shares. Pursuing a licensing-based business model, scaling to profitability may be far easier for Solid Power to achieve as well.
If you’re thinking of rolling the dice with QS, you may want to consider rolling the dice with SLDP instead.
SoFi Technologies (SOFI)
SoFi Technologies (NASDAQ:SOFI) is another speculative name that has experienced a resurgence in popularity.
Year-to-date, shares in the fintech/neobank are up by more than 72.6%. A big factor driving this has been the resumption of student loan repayments.
An end to the “student loan saga” is viewed as one of the top catalysts for SOFI stock, given that this event suggests a rebound in demand for SoFi’s student loan refinancing offerings.
A much larger catalyst for the stock is this digital-first financial institution’s penetration of the retail banking market.
While only the 90th largest bank by assets today, SoFi’s focus on winning the business of affluent customers “not well served” by traditional banks could enable it over time to scale into an institution on par with the “old school” institutions. This in turn would undoubtedly lead to a continued rebound for SOFI stock.
On the date of publication, Thomas Niel 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.