The best penny stocks to buy now have significant upside potential and limited downside risk.
Generally, stocks in new industries like the growing cannabis, marijuana, blockchain, or cryptocurrency industries are popular penny stock candidates.
But big name companies like Groupon qualify as penny stocks too – if you define penny stocks as trading below $5, which is the definition applied by the SEC.
Lots of pharmaceutical and healthcare stocks tend to fall into this category too because one FDA drug approval can catapult a share price to the moon.
So let’s get right to it, what are the hot penny stocks to buy?
Smart & Final Stores [SFS)
Smart & Final Stores is a food retailer that operates warehouse-style grocery stores.
In California, Nevada, and Arizona, it operates under the Smart & Final brand while in Idaho, Montana, Utah, Oregon, and Washington, it best known as Cash & Carry Smart Foodservice.
Shoppers can buy produce, deli meats, dairy and cheeses, as well as restaurant equipment and janitorial supplies among the long list of products.
Smart & Final Stores operates white-label brands too, including:
- Montecito
- Iris
- Ambiance
- Sun Harvest
- Simply Value
- First Street
When you think of a penny stock, you probably imagine a company that will shoot to the stars or crash and burn. What sets Smart & Final Stores apart is it is a low-priced penny stock with big upside potential yet has been around since 1871.
The company operates 323 stores and earns an ISS Governance QualityScore of 9, suggesting that it is well run at the executive level.
Groupon [GRPN]
Groupon is well-known to most consumers as the first deal site to break through to the masses.
It operates an online marketplace connecting consumers to local businesses. Shoppers enjoy lower prices thanks to coupons and discounted deals while businesses attract new customers.
Whether you looking for deals at events, spa services, health care, food and drinks, electronics, sporting goods, jewelry, toys, or apparel, Groupon is the place to go.
Groupon has received criticism from businesses who often sell vast quantities of goods at rock bottom prices but fail to win the repeat customers needed to earn an overall profit.
Nevertheless, local businesses who need customers in a hurry have few better sales channels to turn to than Groupon.
And the numbers speak for themselves. Groupon may be a hot penny stock but it’s still a multi-billion dollar company that earns billions of dollars in revenue.
Kinross Gold [KGC]
For gold bugs hunting for penny gold stocks, Kinross Gold Corporation hits the mark.
Kinross Gold explores, extracts, acquires, and processes ore containing gold. It also reclaims gold mining properties and produces as well as sells silver.
When you are investing in penny stocks, it is always a good idea to lower risk wherever possible and one way to do that is to select companies that have survived economic booms and busts.
Kinross is among the list of penny stocks that falls into that “longevity” category because it was founded in 1972.
Another plus for Kinross is that it has operations in the United States, Canada, Brazil, Russia, Chile, Ghana, and Mauritania.
Global Self Storage [SELF]
Dividend paying penny stocks aren’t exactly a dime a dozen because companies with low share prices often are at an early stage in their life-cycle and reinvest to spur future growth.
For investors seeking one of the cheapest penny stocks that still pays out a handsome dividend, Global Self Storage is hard to beat.
The reason the dividend is so generous is because the company operates as a REIT, which is self-administered and self-managed.
It owns, operates, acquires, and develops self-storage facilities in the Illinois, Indiana, Connecticut, Ohio, Pennsylvania, New York, and South Carolina.
Residential and commercial customers can easily access and secure storage space while shareholders can enjoy a dividend that pays an order of magnitude more than a bank savings account.