The Frugal Investor’s Guide to 3 High-Potential Penny Stocks


  • These penny stocks belong on your radar.
  • Brilliant Earth Group (BRLT): BRLT designs and sells diamonds, gemstones and jewelry with strong financial performance.
  • Arbe Robotics (ARBE): ARBE provides 4D imaging radar solutions for autonomous vehicles.
  • Jerash Holdings (JRSH): JRSH operates in the apparel manufacturing sector, serving major global brands.
high-potential penny stocks - The Frugal Investor’s Guide to 3 High-Potential Penny Stocks

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There are some high-potential penny stocks that investors should consider adding to their portfolios as we enter this year’s second quarter.

Penny stocks are shares of small public companies that trade at low prices, typically below $5 per share. While they are considered highly speculative investments, high-potential penny stocks can offer several advantages and benefits for investors willing to take on higher risk.

Furthermore, high-potential penny stocks may improve risk-adjusted returns in bull markets due to their potential for significant price appreciation and leverage. In a bull market, when stock prices are generally rising, these stocks can experience substantial gains as investor sentiment and risk appetite increase.

I think most investors can benefit by owning a small number of shares in these risky companies, especially if their investment horizon is over 10 years. Making a small calculated gamble can pay off big.

So, here are three high-potential penny stocks for investors to consider.

Brilliant Earth Group (BRLT)

A jewelry display inside of a story
Source: Shutterstock

Brilliant Earth Group (NASDAQ:BRLT) designs, procures and sells diamonds, gemstones and jewelry in the U.S. and internationally.

The company reported a net income of $1.1 million and an adjusted EBITDA of $5.1 million in the first quarter of 2024, exceeding expectations. The company also plans to open three new showrooms later in the year, two in Boston and one in New York City.

Financially, the company has shown resilience, with its earnings per share (EPS) for the first quarter of 2024 being reported at $0.03, which exceeded the analysts’ consensus estimate that predicted a loss​​. That performance marks a continuation of the growth seen in 2023, where Brilliant Earth delivered record net sales amounting to $446.4 million for the year, significantly outpacing industry growth rates.

BRLT could then be one of those high-potential penny stocks for investors to consider given its recent financials and long-term growth prospects for further gains.

Arbe Robotics (ARBE)

3 Top Artificial Intelligence Stocks You Should Consider
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Arbe Robotics (NASDAQ:ARBE) is a semiconductor company based in Israel, providing 4D imaging radar solutions for autonomous vehicles.

For the year 2023, Arbe Robotics maintained its revenue guidance between $5M and $7M. However, it anticipates achieving the lower end of this range. The company is actively engaging with several original equipment manufacturers (OEMs), which represent a significant portion of the global passenger vehicle market. 

The company also has strong liquidity, with $49 million in cash and deposits as of the end of Q3 2023, which is expected to support operations into 2025. Despite the reduced revenue projections for 2023, analysts like Matthew Galinko from Maxim Group have maintained a bullish outlook for the stock, with a price target of $5.

4D imaging radar solutions could potentially be a game changer for autonomous vehicles, and I feel it’s penny stocks like ARBE that are pushing the needle in the arena.

Jerash Holdings (JRSH)

apparel stocks: colorful clothes on a white rack with a bright yellow background
Source: Africa Studio/

Jerash Holdings (NASDAQ:JRSH) operates in the apparel manufacturing sector, producing and exporting customized and ready-made sports and outerwear.

The company continues to serve major global brands and has robust production facilities supporting its operations. It employs approximately 5,000 people and maintains six factory units and four warehouses. 

Jerash Holdings reported a decrease in revenue for the fiscal year 2024 third quarter, earning $27.5 million compared to $43.0 million in the same quarter last year. The drop was largely due to supply chain disruptions caused by geopolitical tensions in the Middle East, affecting shipments of raw materials and production. Despite these challenges, the company remained profitable, with a gross profit of $4.5 million for the quarter.

JRSH could then be one of those penny stocks for investors to consider adding to their portfolios if they seek an undervalued option in the manufacturing sector. The short-term volatility of the stock could be outweighed by its overall potential.

On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that’s writers disclose this fact and warn readers of the risks.

Read More: Penny Stocks — How to Profit Without Getting Scammed

On the date of publication, Matthew Farley did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the Publishing Guidelines.

Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.

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