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This month in March is a great time to pick up shares in these best penny stocks to buy. I chose the companies due to their strong fundamentals and potential for significant upside. Investing in penny stocks can provide the opportunity for substantial returns, as these lower-priced shares have more room for capital appreciation compared to large-cap stocks.
However, penny stocks also come with increased volatility and risk, so it’s important to thoroughly research each company.
With major indices like the S&P 500 and Nasdaq trading at relatively high valuations, penny stocks may also offer a more attractive entry point. Many analysts believe the broader markets are overvalued and due for a correction after the extended bull run. In an overvalued market, cheaper penny stocks have more room for upside potential compared to large established companies.
So with that said, here are seven of the best penny stocks to buy for investors to consider for their portfolios. Don’t miss out on these options to add to cheap shares.
Taboola (TBLA)
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Taboola (NASDAQ:TBLA) specializes in online advertising, holding the attention of numerous hedge funds.
The company concluded 2023 with solid fourth-quarter earnings and is optimistic about its growth in 2024. In Q4 2023, revenue grew by 13% year-over-year to $419.8 million, and the Adjusted EBITDA was $50.1 million, exceeding their guidance.
The net income for Q4 stood at $3.7 million. Despite the yearly net loss of $82.0 million, Taboola forecasts significant growth for 2024, aiming for a revenue increase of 33% to nearly $2 billion, with Adjusted EBITDA expected to surpass $200 million.
Taboola’s strategic focus includes leveraging its partnership with Yahoo, which is expected to contribute over $100 million in Q1 2024. The company also announced a $100 million share buyback program
Meanwhile, Wall Street analysts maintain a “Buy” consensus rating for TBLA, with an average price target of $5.94, suggesting a potential upside of 37.2% from the current price.
Adaptive Biotechnologies (ADPT)
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Adaptive Biotechnologies (NASDAQ:ADPT) is a biotech firm that didn’t meet third-quarter expectations, yet it remains a significant interest among hedge funds.
In Q4, revenue decreased by 17% year-over-year to $45.8 million, while the full-year revenue saw an 8% decline to $170.3 million. The company’s MRD (Minimal Residual Disease) segment showed growth, with Q4 MRD revenue increasing by 9% to $30.8 million and full-year MRD revenue up by 18% to $102.7 million.
Looking ahead to 2024, ADPT projects its MRD business revenue to be between $130 million and $140 million, with operating expenses expected to range from $360 million to $370 million.
I like ADPT are one of those best penny stocks to buy due to the consensus on Wall Street, with the average price target set at $7.25, indicating a potential upside of 132.37% from the current share price. The forecasts range from a low of $5 to a high of $10.
Biotech stocks are always risky, but I think that ADPT has strong potential.
Grab Holdings (GRAB)
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Grab Holdings (NASDAQ:GRAB) operates in ride-hailing and has shown impressive growth.
Additionally, the launch of the Malaysian digital bank GXBank marked a significant milestone for GRAB, achieving over 100,000 customer signups within the first two weeks. GRAB plans to further attract new users by introducing high-value offerings.
In pursuit of full-year profitability for 2024 GRAB is focusing on organic growth and investing in AI technologies. The adoption of AI has enabled GRAB to significantly reduce content generation time, from 99 hours to just 90 minutes, while improving output quality.
The company has outlined a clear path to steady group adjusted EBITDA growth and improved adjusted free cash flow generation. Among its capital market activities, GRAB announced plans to repay its remaining Term Loan B debt facility, expected to save approximately $50 million in annual interest expenses.
I’ve been bullish on GRAB for a while, and these initiatives underscore why I think it could be one of those penny stocks to buy.
Opendoor Technologies (OPEN)
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Opendoor Technologies (NASDAQ:OPEN), a real estate platform, has seen substantial gains in 2023 and is expected to achieve a free cash flow breakeven milestone by the first half of 2024.
The company increased its market share significantly from Q1 to Q4 and saw a contribution margin of 8.3% from its new inventor. Adjusted operating expenses saw a nearly 30% year-over-year reduction in Q4, aside from reduced advertising spend.
For 2024, OPEN has set a revenue target between $1.05 billion and $1.1 billion for Q1, with a contribution profit expected to be between $40 million and $50 million. This outlook implies a contribution margin of 3.8% to 4.5%, with an adjusted EBITDA loss projected between $70 million and $80 million.
The company anticipates first quarter home purchases to remain flat compared to Q4 but to increase significantly year-over-year, with a continuous upward trend expected into Q2.
AbCellera Biologics (ABCL)
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AbCellera Biologics (NASDAQ:ABCL) is a biotech firm that’s been in the spotlight for its potential in strategic partnerships and innovations in biotech.
Analysts have projected its financial performance for 2024 with an expected revenue of $48.05 million and a net income forecasted to be -$187 million. Looking further ahead into 2025, revenue is anticipated to grow to $64.79 million, though the net income is expected to deepen to -$215 million.
For the most recent quarter, ABCL reported earnings that fell short of analysts’ expectations. The reported EPS was -$0.17, missing the consensus estimate by $0.03. Revenue was also down, with revenue reported at $9.18 million against analysts’ expectations of $9.58 million.
However, I think that this is short-term bad news and par the course for anyone investing in biotech stocks. Its valuation is perhaps its biggest draw card, trading at just around $4.30 at the time of writing, with multiples far below that of its peers.
Blink Charging (BLNK)
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Blink Charging (NASDAQ:BLNK) specializes in electric vehicle charging infrastructure and has reported significant growth. The company announced a record-breaking revenue in the third quarter of 2023, surpassing its previous records.
In a move to boost its manufacturing capabilities and embrace domestic production, BLNK has initiated the development of a new 30,000-square-foot factory in Maryland. This facility is set to more than triple the company’s EV charger production capacity to over 50,000 units annually, a significant leap from the current capacity of 15,000 units.
The company’s prospects have garnered attention from analysts and investors alike. Needham upgraded BLNK stock from a “Hold” to a “Buy” rating, setting a price target that suggests a significant upside. The consensus among eight analysts offers a “Buy” recommendation, with a 12-month average price target indicating a potential increase of over 246%.
That prie target alone then makes it one of those best penny stocks for investors to buy.
Bitfarms (BITF)
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Bitfarms (NASDAQ:BITF), a Bitcoin (BTC-USD) mining company, has experienced a substantial increase in its stock price, driven by its aggressive expansion plans and the bullish trend in Bitcoin.
In 2023, BITF focused on growth, laying a foundation for aggressive expansion in 2024. Their monthly Bitcoin production showed a year-over-year decrease from 5,167 BTC in 2022 to 4,928 BTC in 2023, with a noticeable drop in BTC earned from December 2023 (446 BTC) to February 2024 (300 BTC)
Looking ahead, BITF’s strategy includes a transformative fleet upgrade to support a projected 17 EH/s and 391 MW by the end of 2024. This includes acquiring additional miners to reach a target hashrate of 21 EH/s within the same timeframe.
Bitcoin miners like BITF generally show a strong correlation with the price of Bitcoin, with these stocks being sensitive to the price movements of the currency. In fact, these firms often make even greater moves, which can amplify both gains and losses for investors.
I think that BITF could be a good pick for investors who want exposure to the crypto market with a miner that’s greatly expanding its mining capacity.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.
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