Best Penny Stocks on Robinhood To Invest In for 2025
Written by
John Csiszar
Edited by
Nupur Gambhir
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Trading penny stocks is a high-risk, high-reward proposition that involves buying an equity stake in small companies whose shares trade for less than $5. Not all brokerages offer access to the so-called pink sheets, but investors can trade penny stocks on Robinhood. However, even on that innovative, zero-commission broker’s trading platform the selection is limited.
See: 3 Things You Must Do When Your Savings Reach $50,000
If you’re considering diving into this corner of the investing world, understand that it is defined by low liquidity, murky financial reporting and erratic pricing. Do your research first and risk only money that you can truly afford to lose.
But when you’re ready, you don’t need more than a few bucks and a free account on one of the world’s most popular trading platforms. Keep reading to learn about the best penny stocks on Robinhood.
Best Penny Stocks in 2025
1. Nokia Oyj (NOK)
Nokia is one of the few “penny” stocks that actually has a large-cap market capitalization — $27 billion in Nokia’s case — and worldwide name recognition. In spite of these advantages, the stock has essentially gone nowhere over the past 14 years. But it may be on the move. YTD, Nokia is up over 15%, and it has popped more than 50% over the past year. Analysts have a 12-month price target of $5.68, about 11% above current levels.
2. Ardelyx Inc. (ARDX)
Ardelyx is a biotechnology company that’s working to develop therapies for conditions with high unmet medical needs. The company currently has one FDA-approved product, Ibsrela, a therapy that’s available in the United States and Canada for patients with IBS-C.
However, the company has an impressive pipeline that includes three ongoing clinical programs, each with the potential to produce highly profitable products. All told, if you’re interested in investing in a penny stock in the healthcare space, ARDX is a strong pick to consider.
3. Vaalco Energy Inc. (EGY)
Vaalco Energy is a Texas-based independent energy company that focuses on producing oil and other energy commodities. The stock has had a rough year with the price of oil plummeting, but if oil recovers, Vaalco Energy is in a prime position to take advantage of the growth.
The company increased production by 7% in 2024 and will likely boost this figure if oil prices recover. In the meantime, investors can reap a 7.18% dividend yield, an extraordinary amount for a penny stock.
Why Invest in Penny Stocks?
Penny stocks offer the potential for rapid growth, both in terms of the underlying company and its stock price on the open market. Penny stocks are usually highly speculative, thinly traded and often pushed by touts who market the stock, profit from gains and then get out, leaving small investors holding the bag. Other penny stocks are “fallen angels,” formerly thriving companies whose price fell to under $5 per share due to poor performance.
Regardless of the reason, investing in stocks that trade for less than $5 per share should be considered high-risk — as in, you should be prepared to lose anything you put in. But once in a while, a penny stock will skyrocket, providing high returns in exchange for that risk. In exchange for the risk of losing everything, penny stocks can occasionally provide high returns.
Penny Stocks vs. Other Investment Options
Penny stocks are completely inappropriate investments unless you’re a speculative, high-risk trader who can afford to lose everything. For this reason, most investors should steer clear of penny stocks and stick with established companies. While even well-known, mega-cap companies like Nvidia can be volatile investments, they are viable, profitable companies with real-world products and transparent financials — something that can’t be said for penny stocks. To further diversify your risk, consider investing in mutual funds or ETFs, which hold hundreds or even thousands of individual stocks.
| Investment | Pros | Cons |
| Penny stocks | Can provide sky-high returns | Highly speculative; investing involves risking entire principal |
| Individual equities | Financials reported publicly; followed by numerous analysts; can provide above-market returns | Can be more volatile than the overall market; higher risk-reward profile than investing in funds or ETFs |
| Mutual funds/ETFs | Diversified portfolio; professional money management | May not match the returns of individual investments; carry annual expenses |
Risks of Investing in Penny Stocks
The primary risk of investing in penny stocks is that you will lose your entire principal. Many penny stocks are fly-by-night companies in the pre-revenue stage that have no financials to speak of and only trade on the hype generated by market participants. Prices can move up and down based on emotion or even manipulation rather than any actual financial news. This makes their price movements hard to predict. In many cases, penny stocks simply go bankrupt before their companies even bring any products to market.
Trends Shaping the Penny Stocks in 2025
Penny stocks aren’t shaped as much by general market conditions as more established stocks are. Rising inflation, geopolitical tensions or governmental legislation doesn’t tend to affect the supply and demand for penny stocks as much as company-specific items. For example, if a company announces that it’s bringing a product to market or making some other significant public disclosure, speculators are likely to pile in. The same is true if a stock gets touted by market promoters or online message boards. It is true, however, that penny stocks in general tend to gain more interest during ebullient markets, as speculators are more optimistic.
How To Buy Penny Stocks on Robinhood
To buy penny stocks on Robinhood, follow this procedure:
- Open an account on Robinhood: You can open an account online in a matter of minutes.
- Fund your account: You generally can’t buy stocks on Robinhood until after you deposit money. In some cases, you can use the “Instant Deposit” feature, but you can’t use that money to buy penny stocks.
- Screen for penny stocks: You can use the filtering features on the Robinhood website to search for stocks that trade for $5 or less.
- Do your research: Understanding the stock you’re buying is important no matter which one you’re buying, but it’s critical for penny stocks. Information is hard to find on penny stocks, so performing your due diligence can help you both avoid disastrous investments and potentially find winning ones.
Andrew Lisa contributed to the reporting for this article.
Information is accurate as of Apr. 17, 2025, with stock data sourced from Yahoo! Finance.
Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.
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- Vaalco Energy. 2023. "VAALCO Energy, Inc. Declares Increased Dividend and Provides Operational Update."
