There are three penny stocks for the upcoming bull run that you should know about. My thesis for the rest of the year is the S&P 500 and the Nasdaq will shake off fears of a correction and repeat last year’s stellar performance. Despite some geopolitical uncertainties, I feel the backdrop of a strong U.S. economy and falling interest rates will be a boon for these speculative penny stocks, which could send their valuations soaring.
While penny stocks are generally considered highly speculative investments, the potential for massive gains makes them an intriguing opportunity, especially in a bullish market environment. Owning shares of promising penny stock companies now could allow investors to get in on the ground floor before any significant price appreciation occurs.
Of course, comprehensive research and risk management are absolutely critical when investing in penny stocks. That’s because of their volatility and lack of readily available information or analysis compared to large-cap companies. So, I believe it’s best to dollar cost average (DCA) into these speculative positions over the year instead of dumping one’s entire investment into these firms.
Here are three penny stocks for the upcoming bull run that investors should know about.
Grab Holdings (GRAB)
Grab Holdings (NASDAQ:GRAB), a ride-hailing platform, has been supported by 25 hedge funds, including Tiger Global Management.
I’ve been bullish on GRAB for a long time and will continue to do so. For me, GRAB represents the economic opportunity that exists in Southeast Asia, which contains some of the fastest-growing economies like Vietnam and Thailand. GRAB is helping to facilitate a rising middle class in these regions through the gig economy, and there’s no lack of good news for the company.
For GRAB’s Q4 2023, the company reported a revenue increase of 30% year-over-year (YoY) to $653 million, with an EPS of $0.01, surpassing estimates by $0.03. Looking ahead, GRAB is projected to continue its positive trajectory with an EPS growth expected to reach $0.06 next year, indicating a potential 500% increase.
If I had to choose one penny stock to bet on amid a bull run for equity, it would be GRAB.
Archer Aviation (ACHR)
Archer Aviation (NYSE:ACHR) is a flying car stock with promising partnerships and an expanding market presence. I think it could be one of the more underappreciated picks in the market, with most investor dollars flowing to companies such as Joby Aviation (NYSE:JOBY). This, then, gives ACHR a slight edge in its valuation.
ACHR is actively working on constructing its first three conforming Midnight aircraft, essential for FAA certification and the company’s goal of commercialization by 2025. These aircraft will undergo “for credit” testing with the FAA.
During strong bull markets, speculative or emerging technologies like flying cars can deliver great returns for investors. The risk appetite can be enticing during backdrops such as these, with high implied volatility and inducing feelings of FOMO, courting both traders and investors into the mix at once.
ACHR is one of my favorite flying car stocks to buy, and I think we’ll see the best of it in a bull run.
Iris Energy (IREN)
Iris Energy (NASDAQ:IREN), based in Australia, focuses on renewable energy for Bitcoin (BTC-USD) mining.
As the next bull run for equities will coincide this year, I also think it will be a great time to invest in Bitcoin-mining penny stocks like IREN. However, this company is not exclusively involved in the industry itself. That may help to offset some of the risks of regulation and the excessive energy consumption of the coin.
IREN is also in a strong financial position with some great recent results. In the second half of the fiscal year 2024, IREN reported an adjusted EBITDA of $14 million. That marked a substantial increase from the $6.8 million it achieved in the first quarter of the same fiscal year. The company also reported having $90.3 million in cash and cash equivalents with no debt.
The brand also has successfully increased its operating capacity from 5.6 EH/s to 6.2 EH/s as of February 2024. It also secured a pathway to reach 20 EH/s by the end of 2024. That expansion includes the acquisition of Bitmain S21 and T21 miners and the signing of cloud services contracts.
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, Matthew Farley did not hold (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.