There’s a certain allure in the world of penny stocks. For savvy investors, the promise of top penny stock picks is too enticing to resist, especially when you can scoop up several shares with a $100 bill. However, like any investment, they’re not without risk, as market experts would tell you how penny stock enthusiasts could see their investments evaporate completely.
However, 2021 witnessed some high-potential penny stocks shattering expectations, with a few even rocketing to stupendous 1,000% returns in a flash. As we enter 2023, investors have an amazing opportunity to explore the world of penny stocks, where the allure of quick expansion and substantial gains remains as beguiling as ever.
Notably, the most promising stocks are built on reliable business models and robust fundamentals. If you’re thinking about diversifying your portfolio, these three standout penny stocks aren’t just a gamble but a calculated stride toward long-term expansion.
Tilray Brands (TLRY)
Tilray Brands (NASDAQ: TLRY) stands tall, not just in Canada but on the global stage. This cannabis stock is primed for promising returns as its stock price skyrocketed by more than 50% after exceeding forecasts for revenue and earnings last month.
TLRY’s fourth-quarter performance was impressive. Its revenue increased 20% year-on-year to a record $184.2 million. The company trimmed down its net loss of $120 million from an astonishing $458 million in the prior year quarter. Combined with a whooping 93% boost in adjusted EBITDA at $22 million, a pivotal shift was the transition from a negative$21 million operating cash flow to a positive $44 million, signaling a robust financial turnaround.
Furthermore, with the recent acquisition of a 57.5% stake in Truss Beverage and the addition of eight beer and beverage brands from Anheuser-Busch (NYSE: BUD), TLRY is going full-steam ahead with its expansion efforts. Additionally, with 10.6 million potential Canadian consumers and flaunting a promising 2024 projection, Tilray’s growth prospect looks promising.
EVgo Inc. (EVGO)
In a turbulent EV market landscape last year, EVgo Inc. (NASDAQ: EVGO) displayed remarkable stability. Unlike its peers, EVgo relies exclusively on DC fast charging, offering services powered entirely by renewable energy. That strategic focus, backed by a robust network of over 3,000 DC fast-charging stalls, positions the company uniquely in the market.
Against a rather challenging backdrop, EVgo’s second-quarter metrics bolster optimism. The company’s revenues shot up 457% rise year-over-year, clocking in at $50.6 million, coupled with a strong customer base close to the 700,000 mark — another testament to its growth prospects. Moreover, EVgo is gearing up its NACS deployment, directly taking on Tesla’s Supercharger network. With analysts projecting an astounding 48% upside potential, it’s showcasing startling potential in the foreseeable future.
Ardelyx (ARDX)
Ardelyx (NASDAQ:ARDX) is a biopharmaceutical innovator specializing in renal and cardiovascular care, driving novel therapeutic solutions forward. The stock has consistently shown a positive outlook, registering a solid 350% ascent year-over-year. Moreover, TipRanks’ seasoned analysts believe there’s still substantial room for growth, setting a target price at an average of $9.50, representing a potential upside of a jaw-dropping 126%.
Delving deeper into Ardelyx’s financials, the firm’s fiscal strength is evident. Its total cash, cash equivalents and short-term investments reached $127.6 million, reflecting a 4% growth since the beginning of the year. Moreover, in terms of product performance, a significant development to note is the FDA’s recent acceptance of XPHOZAH (tenapanor). With the green light, the drug is set to cater to a vast demographic of 390,000 U.S. dialysis patients. Additionally, the business presented encouraging findings at the National Kidney Foundation’s 2023 Spring Clinical Meetings. With these developments, Ardelyx seems to be moving in a direction with encouraging long-term prospects.
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, Muslim Farooque 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.
