Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.
Penny stocks can be a good investment vehicle—if you conduct due diligence. In fact, there are a number of legitimate stocks to consider that are as cheap as $1. The fundamental investment rules apply, and a keen eye can separate the wheat from the chaff. Various factors can help determine the quality of the stock, as we shall see.
Stocks Under $1 With High Potential
By doing due diligence and investing carefully, you can take advantage of the quick growth that penny stocks are experiencing. We’ve listed here the five best stocks for you to mull over.
Gulfport Energy explores, develops, acquires, and produces natural gas, crude oil, and natural gas liquids (NGL) in the United States. The company’s main properties are located in the Utica Shale in Eastern Ohio. It has approximately 4.5 trillion cubic feet of natural gas equivalent of proved reserves, as of 2019.
Gulfport Energy has a market cap of $57 million — a pittance when stacked against the biggest players in the space. But that is part of the attraction with penny stocks.
The first mining exploration company on the list is Tanzanian Gold Corporation, which has all of its properties located outside the United States. However, its natural resource exploration is primarily focused on gold in Tanzanian properties.
The company has mineral properties in Buckreef Project, Kigosi Project, Lunguya Project Area, Itetemia Property, and the Luhala Property. With a $127 million market cap, Tanzanian Gold Corp might not be the most significant player in its domain, like Gulfport.
The company succeeded in acquiring $4 million in financing, which will be used for expansion. It also reported a doubling of gold resources in June, which pleased investors.
The financing will be used to expand its Buckreef plant oxide mining and processing.
The Buckreef shear zone has doubled in terms of tonnage and increased by two and a half times in terms of contained ounces.
Our second company in the list is Canada-based Great Panther Mining. It deals in the exploration and production of silver, gold, zinc, lead, and copper in Mexico. Properties include the Topia and Guanajuato mines in Mexico, the Coricancha mine in Peru, and the Tucano mine in Brazil.
Great Panther Mining’s Q3 2020 report indicates fairly unaffected operations despite the COVID-19 pandemic. The management has emphasized that all of its mines are operating well despite challenges in the production line. This is because the company has implemented stringent protocols, including screening and testing, in the wake of the pandemic.
The company reported a 3% increase in gold equivalent ounces (Au eq oz) produced 39,788 Au eq oz in Q3 2020.
Ampio Pharmaceuticals is a biopharmaceutical company that produces treatments for inflammatory conditions in the United States. It is developing compounds that decrease inflammation by inhibiting specific pro-inflammatory compounds. Products to note include Ampion, a treatment of osteoarthritis of the knee.
The company is developing treatments for COVID-19, which has shown a degree of success. These will probably be overshadowed by the work of bigger companies, but it’s a step in the right direction.
Matinas Biopharma is another small-sized biopharmaceutical company, though with a slightly bigger market cap than Ampio. It focuses on the discovery and development of various treatments, including omega-3 fatty acid therapy for treating cardiovascular and metabolic conditions.
The company also has two more products in the pipeline for the treatment of fungal infections and Non-Tuberculous Mycobacterium. Like Ampio and other pharma companies, it has benefitted from the spotlight brought on by the COVID-19 pandemic. The company’s quarterly reports are middling, but the upside prospects could be good given the YTD performance.
Cash equivalents and marketable securities at the end of Q2 2020 was reported to be $68 million.
The company reports that cash on hand is sufficient until the first half of 2023.
Matinas reported a net loss of $5.8 million or $0.03 per share.
There you have it — this isn’t an exhaustive list, but it’s a good starting point for your research. Additionally, the leading penny stockbrokers offer a number of tools that can aid your analysis.
As is the case with any investment, you need to follow the usual protocols of safe investing. These companies have upside potential and are worth examining.
Do you have any penny stock recommendations of your own? What do you think of the stocks listed here? Let us know in the comments below.
Disclosure:Tim Fries has no positions in any of the stocks mentioned, and has no plans to initiate any positions within the 72 hours following the publishing of this article. This article expresses the opinions of Tim Fries. Tokenist Media LLC has no position in any of the stocks mentioned, and does not plan to initiate any positions within 72 hours of the publishing of this article. Please consult our website policy for more information.
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firms specializing in sensing, protection and control solutions.