7 Best Penny Stocks Under $3 to Buy Now

  • For investors that occasionally want to have their turn at the craps table, here are the best penny stocks under $3 to buy now.
  • InPlay Oil (IPOOF): A growth-oriented light oil development and production firm, InPlay Oil has strong fundamentals to potentially lift its share price.
  • ECA Marcellus Trust (ECTM): A royalty trust in the natural gas space, ECA Marcellus Trust is fundamentally relevant, though it's also highly risky.
  • Canopy Growth (CGC): After enjoying much hype from Canada's cannabis legalization, Canopy Growth is now one of the best penny stocks under $3.
  • Mullen Automotive (MULN): Although there are plenty of reasons to be skeptical about Mullen Automotive, its loyal fanbase has meme-stock energy to the max.
  • Iamgold (IAG): Having stumbled due to an important project likely to be costlier than anticipated, Iamgold could still be interesting for those that anticipate heavy inflation.
  • Platinum Group Metals (PLG): For those that want to speculate on the industries of tomorrow, Platinum Group Metals could be one of the best penny stocks to buy.
  • Geron (GERN): A biotechnology firm that is conducting advanced research to address certain cancers, Geron could be a worthwhile target for speculation.
Best penny stocks - 7 Best Penny Stocks Under $3 to Buy Now

While financial advisors will often bristle at the notion that the equities sector is nothing more than glorified gambling, the phrase does stick with the best penny stocks under $3 to buy in July. Typically, this sector describes publicly traded companies whose shares are priced around $5 or below. Usually, you should stay away from cheap securities because there’s often a reason (and not a good one) why they became that way.

If you didn’t get the message the first time, let me state it again: you don’t want to participate in this segment with money you can’t afford to lose. And I want to be absolutely clear about the caveat here, even if we’re discussing the so-called “best penny stocks.”

With the warnings out of the way, the intriguing aspect of these highly volatile equities is, in exchange for the risk, you enjoy tremendous reward potential. In other words, for being at the right place at the right time, you might be able to accrue significant profitability from the best penny stocks under $3.

Just be super careful with these ideas.

Ticker Company Price
IPOOF InPlay Oil Corp. $2.00
ECTM ECA Marcellus Trust $2.05
CGC Canopy Growth Corporation $2.19
MULN Mullen Automotive, Inc. $1.13
IAG IAMGOLD Corporation $1.43
PLG Platinum Group Metals Ltd. $1.34
GERN Geron Corporation $1.85

Best Penny Stocks: InPlay Oil (IPOOF)

Big industrial oil tanks in a refinery base. Oil stocks., CEI stock
Source: OlegRi / Shutterstock

If you regretted missing the boat on acquiring crude oil-based investments this year, you might be able to strike gold with InPlay Oil (OTCMKTS:IPOOF). According to the company’s website, InPlay “is a growth-oriented light oil development and production company based in Calgary, Alberta.”

Further, the company claims that it is “focused on large oil in place pools with low recovery factors, low declines, and long life reserves primarily targeting the Cardium Formation in Alberta. InPlay has a strong balance sheet allowing it to weather commodity volatility and develop its extensive inventory of horizontal drilling locations.”

What’s interesting from the point of view of the best penny stocks under $3 is the fundamental narrative. With Russia’s invasion of Ukraine, the military action completely disrupted the modern global order. Today, the search for energy independence has reached a fever pitch. Therefore, it wouldn’t surprise me to see speculative interest move into IPOOF stock.

ECA Marcellus Trust (ECTM)

Offshore hydrocarbon plant.
Source: Oil and Gas Photographer / Shutterstock

Should you desire to ramp up your exposure to the hydrocarbon industry, ECA Marcellus Trust (OTCMKTS:ECTM) might be of interest to you. Structured as a royalty income trust, ECA is a special-purpose financing vehicle that allows its stakeholders to partake in the income generated from natural gas deposits.

From the get-go, ECA Marcellus has one factor that distinguishes it from the competition; namely, massive performance. ECTM is up a staggering 169% on a year-to-date basis as of Jul. 1. However, with the supportive fundamentals mentioned above, ECTM could have more to rise. After all, the U.S.-led sanctions against Russia have effectively shelved a significant portion of global energy supplies.

Aside from its inherent volatility, though, investors should recognize a significant deterrent to ECTM. The tax-filing procedure for royalty income trusts are very complicated and time consuming. But if you want serious upside potential with your best penny stocks, ECTM could be interesting.

Best Penny Stocks: Canopy Growth (CGC)

Person holding mobile phone with website of Canadian cannabis company Canopy Growth Corporation on screen with logo.
Source: T. Schneider / Shutterstock

Leading up to Canada’s legalization of marijuana, shares of Canopy Growth (NASDAQ:CGC) increased significantly in anticipation of the big day. Essentially, what you have with the legal cannabis sector is an illicit market that became a legal and, therefore, taxable one. From a governing body’s perspective, it was extra money in the bank.

Unfortunately, the reality of legalization didn’t quite match the fantasy. Among the many roadblocks to the legal green marketplace in Canada were administrative delays in distributing necessary licenses. Eventually, the investor community lost heart with Canopy and its ilk, leading to a significant downgrade in market value.

Today, CGC is one of the best penny stocks under $3. While myriad challenges remain with the legal cannabis sector, demand for marijuana could increase in go-green jurisdictions. For instance, research indicates that marijuana could be effective for reducing stress — and there’s plenty of stress going on right now with global recession fears rising.

Mullen Automotive (MULN)

The Mullen (MULN) Five vehicle is displayed at the 2021 LA Auto Show media day in Los Angeles, November, 18, 2021.
Source: Ringo Chiu / Shutterstock.com

For the record, I’m personally not too keen on Mullen Automotive (NASDAQ:MULN) and the hype among electric vehicle (EV) upstarts. We’ve seen similar intense fanfare over names like Workhorse (NASDAQ:WKHS) and Canoo (NASDAQ:GOEV), only for them to badly disappoint stakeholders.

On its end, Mullen isn’t doing a great job in building confidence. Earlier, I reported that Mullen promised a comprehensive press release regarding its partnership with a Fortune 500 company in developing an EV pilot program. Later, on the promised date of disclosure, Mullen did not come through with revealing the mystery firm.

Ordinarily, I’m not sure you can toy with investors’ emotions like that. However, Mullen is a different animal altogether. The folks that support MULN stock are severely loyal. But to be fair, fundamental catalysts, such as massive asset managers backing the EV maker, give fuel to the fire.

So, if you want to ignore the calamities in the upstart EV space, MULN just might be one of the best penny stocks under $3.

Best Penny Stocks: Iamgold (IAG)

An image of multiple gold bars
Source: Shutterstock

Some precious metals-related companies did well earlier in the year due to, among other catalysts, the fear trade. However, Iamgold (NYSE:IAG) has really lost the plot since April. Sadly, management revealed that one of its key mining projects may come in at a higher-than-expected cost. Naturally, this disclosure scared off many stakeholders given the rough waters the global economy is currently treading.

On a general note, mining firms offer a convenient alternative to physical gold investments. I’m not sure if you’ve held large-weight bullion, but because of their density, they can be onerous. With mining firms like Iamgold, the record of equity ownership is mostly digital nowadays, so it’s convenient. On the other hand, miners are business entities and slipups like underestimating costs can substantially hurt valuations.

Nevertheless, IAG could make for an interesting candidate among the best penny stocks under $3. Mainly, the negativity could already be priced in. Moving forward, IAG stock could enjoy upside, particularly if inflation remains stubbornly high.

Platinum Group Metals (PLG)

A close-up photo of a platinum bar.
Source: corlaffra / Shutterstock.com

Staying on the precious metals theme, for investors who truly want to dial up the risk-to-reward balance of the best penny stocks under $3 to consider should look into Platinum Group Metals (NYSEAMERICAN:PLG). Specializing in platinum and palladium, Platinum Group Metals focuses on the Waterberg project, which is located in resource-rich South Africa.

Fundamentally, platinum and palladium have significant implications for the automotive industry. Used extensively in manufacturing catalytic converters, both these metals are important to meet international emissions standards. However, Russia is a major player in these commodities — particularly palladium — so developing a reasonably friendly region like South Africa is geopolitically important.

Of course, combustion cars may be on their way out. Interestingly, though, platinum is a key catalyst in fuel cells generating electricity from hydrogen. Therefore, PLG may be one of the best penny stocks to consider if you have an eye for the industries of tomorrow.

Best Penny Stocks: Geron (GERN)

a scientist with protective equipment and microscope in a lab, DAWN
Source: luchschenF / Shutterstock.com

A clinical stage biopharmaceutical company, Geron (NASDAQ:GERN) specializes in the development of a telomerase inhibitor, imetelstat, in hematologic myeloid malignancies.

To put it simply, Geron leverages advanced technologies to exploit cancer cells’ dependency on telomerase, which is a type of ribonucleoprotein. Significantly, the Food and Drug Administration and the European Commission for the European Medicines Agency both granted Geron’s flagship product imetelstat orphan drug designation.

Not surprisingly, then, GERN is on the move, having gained 21% for the week ending Jul. 1. Nevertheless, at the time of this writing, GERN may be one of the best penny stocks under $3.

Still, let me leave you with a note of caution. Speculative biotech firms can be brutally fickle, dependent largely on clinical progress. Therefore, please do not play with money you can’t afford to lose.

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

On the date of publication, Josh Enomoto did not have (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.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.

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