Following the Fed’s recent upbeat remarks, the bulls are charging out, parading their rosy stock market forecasts. Hence, given the positive cues from the Fed, it might be an excellent time to wager on the best penny stocks to buy.
The bull case for a more aggressive approach to investing in the stock market is based on several factors. First, Fed chair Jerome Powell stated that the institution’s next move will unlikely be a rate hike. Second, we’re coming off an incredibly encouraging first quarter (Q1) of earnings, which comfortably surpassed analyst expectations. Hence, given the two positive catalysts, it’s perhaps a perfect time to loosen up and dive into the speculative world of penny stocks.
Penny Stocks to Buy: Grab Holdings (GRAB)
Singapore-based Grab Holdings (NASDAQ:GRAB) is riding the wave of Southeast Asia’s digital revolution with its robust super app. Similar to Uber (NYSE:UBER), its super app offers multiple services, including ride-hailing, parcel delivery, and financial services such as payments and insurance. With a one-stop solution, it streamlines user interactions by essentially consolidating a swath of services through its app.
It operates a hyper-growth business that’s left its competition in the dust, effectively positioning it as a giant in its niche. Revenues have grown by an average of 120% over the past five quarters while making significant strides towards net profitability. Its net loss last year came in at $434 million, compared to $1.68 billion in 2022, representing a healthy 74% improvement.
Furthermore, it still has a long growth trajectory ahead of it, with the stellar expansion in the Southeast Asian internet economy. Last year, the sector was valued at a whopping $218 billion, which forms roughly 6.3% of Grab’s current market cap. Hence, its still early days in Grab’s development, which significantly adds to the excitement surrounding the business.
Niu Technologies (NIU)
Niu Technologies (NASDAQ:NIU) emerges from the vibrant streets of China as an innovative EV player specializing in electric scooters. It offers a fresh perspective into the fiercely competitive electric mobility arena. However, the company has effectively set itself apart from its competition through advancements in scooter technology, sleek designs, and strategic marketing initiatives.
However, like its peers in the EV realm, the company has struggled with demand over the past year. Consequently, we saw the stock nosedive last year by a hefty 37%, and it is now changing hands for under $2.50. Moreover, it’s down more than 95% from its all-time price of $49, which it achieved in February 2021. To refresh your memory, 2021 was a period of robust activity for the EV sector driven by Special Purpose Acquisition Companies (SPACs).
Nevertheless, Niu’s recent results have shown a return to form. In Q1 2024, it sold 129,139 scooters, a substantial jump from the 94,407 units sold in the prior-year period. These numbers are attributable to its new models, particularly its premium flagship model NXT, and an expansion in sales channels. Moreover, based on analyst estimates, it is forecasted to post $471 million in sales this year, a 26% improvement from last year.
Rigetti Computing (RGTI)
Rigetti Computing (NASDAQ:RGTI) is an up-and-coming player in the quantum computing space. It produces and deploys quantum computers and processors and offers quantum computing as a service.
RGTI stock surged over 130% last year, benefiting from the market’s risk-on sentiment. Moreover, it kept the same momentum this year, with year-to-date (YTD) gains of 18%, significantly ahead of the S&P 500’s 9.5% gain.
Clearly, the gains last year had little to do with its fundamentals, with sales dropping from $13.1 million in 2022 to $12 million last year. However, it witnessed a snapback during the first- quarter (Q1), generating $3.1 million in sales, roughly 41% higher than the prior-year period. Moreover, analysts are upbeat about its future, expecting sales to come in at $14.55 million this year and $30.78 million in 2025.
Furthermore, it’s imperative to note that Rigetti is operating in a market poised for rapid long-term growth. Fortune Business Insights forecasts that the quantum computing market will grow from $928.8 million in 2023 to $6.53 billion by 2030, exhibiting a CAGR of 32.1%.
On the date of publication, Muslim Farooque 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.
