The 3 Most Undervalued Penny Stocks to Buy in December

  • These undervalued penny stocks are worth analyzing to add to your portfolio.
  • PAVmed (PAVM): The introduction of EsoGuard 2.0 is an advance in precancer detection.
  • Imperial Petroleum (IMPP): Its making strategic decisions, such as share buybacks and warrants.
  • Performance Shipping (PSHG): The company is focused on growth and operating efficiencies
undervalued penny stocks - The 3 Most Undervalued Penny Stocks to Buy in December

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We cannot end the year without adding a few penny stocks to our portfolio to take advantage of the opportunities coming up in the next cycle. Of course, we must rely on our investment thesis and our own analysis, but here I am to tell you a little about these undervalued penny stocks that are worth analyzing and evaluating to add to our portfolio. Let’s take a brief look.

PAVmed (PAVM)

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PAVmed (NASDAQ:PAVM) is making waves as one of the undervalued penny stocks in the medical diagnostics field, with a particular focus on its subsidiary, Lucid Diagnostics.

The latest financials reveal third-quarter 2023 revenues of $0.8 million, but operating expenses, including share-based costs, came in at $16.3 million, resulting in a net loss of about $17.7 million.

On November 16, 2023, Lucid Diagnostics announced significant additions to its team, welcoming Natalie S. Carfora and James M. Fricchione as Vice Presidents of Market Access and Employer Markets. Shaun M. O’Neil assumes the role of President and COO of Lucid.

He will focus on driving payer coverage of EsoGuard and securing direct contracts, crucial to translating test volume growth into revenue. Lucid President and CEO Lishan Aklog expressed his enthusiasm for the expertise and coordination these additions bring to market access efforts.

Lucid Diagnostics introduced EsoGuard 2.0, the next-generation esophageal DNA test for precancer detection. Improved assay performance and reduced validation study costs are a major step forward.

Imperial Petroleum (IMPP)

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Imperial Petroleum (NASDAQ:IMPP), a Greece-based shipping company, is gaining attention as one of the undervalued penny stocks worth considering for your investment portfolio. The company, which has a fleet of vessels, specializes in shipping vital resources such as petroleum products, crude oil and dry bulk commodities.

Despite facing challenges such as seasonal factors and scheduled maintenance affecting operating days, Imperial Petroleum recorded net income of $12.1 million in the third quarter of 2023, equivalent to $0.56 per share, demonstrating stable financial performance.

The company’s strategic financial decisions, including a share repurchase program and the repurchase of warrants, underscore its commitment to enhancing shareholder value. Imperial Petroleum’s diversified operating strategy is evident in its 70.5% fleet operating utilization in the third quarter of 2023, with 2% of fleet days dedicated to spot activity.

Notably, the company has a strong financial position with cash and equivalents totaling $125.9 million at September 30, 2023, significantly exceeding its current market capitalization.

Recent news further highlights its positive trajectory. The company repurchased more than one million shares of common stock, demonstrating confidence in its own value. In addition, a strategic move involved the repurchase of 2.58 million outstanding warrants to effectively manage its capital structure.

Financial results for the third quarter of 2023, which included revenues of $29.4 million and EBITDA of $13.9 million, highlight the company’s resilience in a challenging operating environment.

Imperial Petroleum’s commitment to shareholder value is underscored by the declaration of a dividend on its Series A Preferred Stock, emphasizing its dedication to rewarding investors.

Performance Shipping (PSHG)

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Performance Shipping (NASDAQ:PSHG) is a global tanker-owning shipping line, primarily focused on freight transportation.

In the third quarter of 2023, they posted net income of $10.4 million, a slight decrease from the previous year. However, the company’s earnings per share for the same period were $0.88 (basic) and $0.27 (diluted), indicating a resilient performance.

Revenue for the third quarter of 2023 totaled $24.1 million, up from $22.1 million in 2022, driven by higher ownership days despite a slight decline in time charter equivalent rates.

Notably, net cash generated from operating activities totaled $17.9 million, up significantly from $11.8 million in the third quarter of 2022.

In a strategic move to enhance shareholder value, the company completed a $2 million share repurchase plan and initiated a new plan to repurchase up to $2 million of its outstanding common stock.

This reflects a commitment to optimize shareholder returns. In addition, Performance Shipping successfully refinanced its existing credit facility, securing a revolving credit facility (RCF) of up to USD 20,000,000 with Nordea Bank Abp. This not only extends the maturity date of the loan, but also provides financial flexibility and potential cost savings.

These positive developments, together with the company’s strong financial results, make Performance Shipping Inc. an interesting option as an undervalued penny stock for possible inclusion in an investment portfolio.

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.

Gabriel Osorio is a former Goldman Sachs and Citigroup employee. He possesses discipline in bottom-up value investing and volatility-based long/short equities trading.


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