Some of the most promising penny stocks can have multi-bagger potential over the long haul. After all, the combination of low prices, strong catalysts, and potentially high returns can be appealing. But I should warn you that not all penny stocks will work out. In fact, not only will I warn you about these upfront, but I’ll add a warning to the tail end of this article, too. When it comes to penny stocks, never risk more than you can afford to lose, which many investors have learned the hard way. that being said, let’s look at a few of the most promising penny stocks.
Most Promising Penny Stocks: Comera Life Sciences (CMRA)
Comera Life Sciences (NASDAQ:CMRA) certainly has a lot of potential, which is quite evident once I started digging into the stock. For one, second-quarter revenues more than doubled to reach just above $315,000, as compared to the $147,000 earned a year earlier. In addition, Comera reported a net loss of $1.5 million, or $0.08 loss for the. quarter, as compared to a net loss of $9.3 million, or $1.14 loss per share, year over year.
Two, the company is engaged with Regeneron (NASDAQ:REGN) for research collaboration, which should be a major catalyst for CMRA. In fact, according to a recent release, “Recent key accomplishments include advancing our ongoing collaboration with Regeneron, bolstering our intellectual property to further protect our SQore platform, and strengthening our cash position,” said Chairman and CEO Jeffrey Hackman.
GEE Group (JOB)
Another one of the most promising penny stocks is GEE Group (NYSEAMERICAN:JOB), an employment and training firm. In its most recent quarter, the company reported that its net revenues fell by 7.2%. However, JOB did nearly triple its net income to $7.876 million. That’s a very strong sign for such an inexpensive stock. It implies that GEE Group is quite well run and doesn’t suffer from poor management.
Even better, the company recently bought back 647,000 shares of common stocks. It’s also authorized to buy back another $20 million shares moving forward. “We remain committed to optimizing capital deployment, including the execution of these share repurchases under present conditions, as well as driving long-term, profitable, organic growth augmented by strategic acquisitions executed using a disciplined pricing approach,” said Derek Dewan, Chairman and Chief Executive Officer, as quoted in a recent release.
Most Promising Penny Stocks: FG Financial (FGF)
FG Financial (NASDAQ:FGF) generates revenue by reinsuring policies the company believes are less risky than expected. In other words, the company purchases part of an insurance company’s liabilities that it believes are less risky than the original insurer has rated them.
FG Financial’s reinsurance premiums increased from $3 million to $3.7 million in the second quarter. That shows that original insurers are increasingly fearful of their liabilities. Of course, if something goes drastically wrong and the economy tanks then FG Financial will be left holding the bag. That’s the bet here: The economy is improving and we’re out of the worst of it. Thus, FG Financial has made a winning bet on buying the liabilities of other insurers. Currently, that is driving the firm’s revenues higher while allowing it to reduce its losses.
T Stamp (IDAI)
T Stamp (NASDAQ:IDAI) is a cheap AI-based trust and identity service firm. Investors are interested in AI for obvious reasons. And investors are interested in cybersecurity for obvious reasons. The intersection of the two promises to create winning firms in the future. T Stamp has the potential to be one of those firms and that’s why investors remain interested.
The firm is focused on becoming an important partner in the U.S. banking and financial sector. It is shifting to SaaS sales in that sector based on AI. The result has been a focus on decreasing expenses by more than 32%. Meanwhile, sales also decreased by a similar amount falling by $247k in the most recent quarter. The company is eager for investors to know that its government relationship means it has future revenues, not yet recognizable, that are above $2.6 million.
KULR Technology (KULR)
KULR Technology (NYSEAMERICAN:KULR) develops and commercializes thermal management technologies for batteries and electronics in the U.S. Revenues grew by 360% in the second quarter and contract revenue increased by 2,300% during the same period.
The firm’s KULR ONE battery pack is seeing particularly strong reception and was awarded a $1.13 million US Army contract for future development. The company has also received a contract to develop uninterruptible power supplies for the United States Armed Forces. Those power supplies are expected to be utilized in mobile command centers. It is clear that KULR Technology has created a strong relationship with U.S. government partners. However, the firm is also developing private industry connections in the EV and air taxi markets.
FiscalNote Holdings (NOTE)
FiscalNote Holdings (NYSE:NOTE) provides market intelligence in the policy space, and like many other firms, is highlighting the fact that it is leveraging AI to do so. Company revenues increased by 21% in Q2 reaching $32.8 million. That alone might not provide investors with the confidence to stand behind the firm with their capital. However, the fact that FiscalNote Holdings has given guidance for EBITDA profitability next quarter should help.
The company has done well in that its annual recurring revenue increased by 16% in the period. That shows that FiscalNote Holdings is capable of providing its business partners with solutions that work. Given the fact that NOTE shares traded above $6 recently, there’s a lot of potential for quick returns for investors.
Grove Collaborative Holdings (GROV)
Grove Collaborative Holdings (NYSE:GROV) sells sustainable soaps and other cleaning products. One of the more powerful reasons to consider GROV stock is that it expects to be “near” EBITDA breakeven next quarter. Overall, the strongest reasons to invest in GROV remain the sustainability angle and the company’s rapidly narrowing losses. The firm has been successful in reducing costs and improving its fundamentals along the way. Investors will warm up to that idea sooner or later.
Penny Stocks
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 InvestorPlace.com’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, Alex Sirois 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.
