Today we’ll be discussing small stocks under $5, although they’re all traded on big exchanges like the Nasdaq and NYSE. Remember that just because they’re not listed on the OTC (Over-the-Counter) market doesn’t mean they’re risk-free. There’s a reason these firms are referred to as penny stocks. It does have a lot to do with the fact that they are still in the early phases of development. However, if you discover the proper balance of risk and reward, these low-cost stocks could provide many possibilities to gain a profit.
Aside from generating quick money, the advantage of investing in penny stocks is the chance to own a piece of a company early on. These aren’t lottery tickets or roulette bets, regardless of common perception. Some penny stocks may have the potential to provide genuine value in the long run. The list of penny stocks that have made it big for investors continues to expand. A few of these companies that have done well for early investors include GameStop (GME), FuelCell Energy (FCEL), AMC Entertainment (AMC), Novavax (NVAX), and Nio Inc. (NIO).
Analyst firms can add a degree of complexity to the due diligence process. While these businesses should not be used as the only basis for making investment decisions, they provide information that you may not have considered or overlooked along the road. Notably, these penny stocks have also been given impressive price targets.
Let’s take a quick look at a few penny stocks under $5 that analysts consider to not only have growth potential but, as always, to be wise picks for our growing portfolios:
Progenity Inc. (PROG)
Progenity, Inc. (PROG) is a company that provides doctors with molecular and specialized diagnostic testing. Preparent Carrier Test, Innatal Prenatal Screen, Riscover Hereditary Cancer Test, and Resura Prenatal Test are some of the company’s available services. Paul W. Hawran and Harry Stylli started the firm in 2010, and it is based in San Diego, CA. The firm is now working on molecular testing products. PROG has sought to improve products such as a test used to rule out preeclampsia in pregnant women.
PROG received a patent for their preeclampsia rule-out test last month, in addition to concluding a $20 million fundraising round. This test is anticipated to target a $3 billion yearly addressable market. Its financials have been impressive so far from the data available. They report earnings again on November 15th of this year, but they have boasted $3.8 million in sales so far. The forecasts from analysts predict annual and quarterly growth for both PROG’s EPS and Revenue. The consensus price target for PROG from analysts providing 12-month predictions is 4.00, with a high of 12.00 and a low of 2.00. The forecast is a 56.25% gain from its previous price. PROG’s buy rating is strong.
Trevi Therapeutics Inc. (TRVI)
Trevi Therapeutics, Inc. (TRVI) is a clinical-stage biopharmaceutical firm developing and commercializing Haduvio to treat severe neurologically mediated diseases. It covers the treatment of chronic pruritus and persistent cough in patients with idiopathic pulmonary fibrosis, as well as levodopa-induced dyskinesia in Parkinson’s disease patients. Thomas R. Sciascia and Jennifer L. Good started the firm in March 2011, and it is headquartered in New Haven, CT.
In TRVI‘s current situation, its most recent filing from last week reveals something that traders are thrilled about right now. However, the business withdrew its petition to issue shares in a private placement. Could this be a bullish occurrence? When a company raises funds in return for shares, such shares are often offered at a discount. The market appears to have seen the withdrawal of the offering as a positive indication. TRVI has a median price target of 10.00, according to the analysts providing 12-month price estimates. The median forecast indicates a whopping 713.01% gain over its current price. The consensus is also to buy shares in TRVI, a buy rating that has held steady all year.
Selecta Biosciences (SELB)
Selecta Biosciences, Inc. (SELB) is a clinical-stage biopharmaceutical business that develops nanoparticle immunomodulatory medicines to treat and prevent human illnesses. It creates what’s called the Synthetic Vaccine Particles (SVP) platform, which is used to promote immunological tolerance and stimulation. The SVP-enabled enzyme, cancer, and gene treatments are all part of the company’s exclusive pipeline. Omid C. Farokhzad, Robert S. Langer Jr., and Ulrich von Andrian formed the firm in 2007, and it is based in Watertown, Massachusetts.
SELB has firmly established itself 100% in the biotech industry. ImmTOR, the company’s platform for developing treatments to address various undesired immune responses, has also been created. ImmTOR has been found to increase the efficacy of various biologic therapies, particularly those for autoimmune disorders. SELB reports earnings again on November 11th, and in the meantime, has shown us $12.2 million in sales. The analysts’ forecasts for annual growth look incredibly positive. SELB has a consensus price target of 8.50, with a high estimate of 13.00 and a low of 6.00 among analysts giving 12-month price estimates. The median estimate is up an impressive 115.74% over its most recent price. Perhaps just as impressive as SELB’s price target gain is its solid buy rating among experts.
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