8 Best Penny Stocks To Buy Under $1.00
Penny stocks — those that trade for under $5.00 — are inherently risky but can also result in great rewards. Because the stocks are so cheap, it doesn’t take much for them to drop to zero. By the same token, a price rise to just a few dollars a share can mean a big payday for investors.
Penny stocks are often found in emerging industries or in those industries that require a long period of research and development prior to the production of a viable product. These stocks are often found in early-stage technology, pharmaceutical, biotech or therapeutics companies.
Best Stocks That Cost Less Than $1
Here are some penny stocks that will cost you less than a dollar and might just be worth the investment.
1. Verastem Inc.
- Price: $0.4350
- Market Cap: $87.33 million
- Consensus Rating: Buy
Verastem (Nasdaq:VSTM) is a development-stage biopharmaceutical company that develops novel therapies for RAS pathway-driven cancers. In addition to its own products in development, Verastem is working to develop, commercialize and manufacture products in conjunction with Chugai Pharmaceutical Co. and Pfizer, and it is collaborating with Amgen in a Phase 1/2 trial involving a combination of both companies’ products.
Verastem stock closed at $0.4350 on May 2. Its 52-week low is $0.29, and the high is $1.52. Of five analysts following the stock in May, one rates it a strong buy, three rate it a buy and one recommends holding. RBC Capital and HC Wainwright & Co. recently reiterated their outperform and buy ratings, respectively.
2. Compugen
- Price: $0.6103
- Market Cap: $55.19 million
- Consensus Rating: Buy
Compugen Ltd. (Nasdaq:CGEN) discovers novel drug targets and develops therapeutics to extend the reach of cancer immunotherapies. The company uses computational discovery to identify immunotherapy drug candidates that show promise in improving patient outcomes.
The stock closed at $0.6103 on May 2. In the past year, the stock price has ranged from $0.51 to $2.50. Of the two analysts following the stock so far in May, one rated it a buy and one rated it a strong buy. Of the seven watching in April, three rated it a buy, three rated it a strong buy and one recommended selling. The 12-month price target is $5.92, which is up slightly from last month.
3. Cybin
- Price: $0.3331
- Market Cap: $63.03 million
- Consensus Rating: Strong Buy
Cybin (OTCMKTS:CYBN) develops proprietary psychedelic-based therapeutics for disorders like major depressive disorder, alcohol use disorder, anxiety disorders and more. The company is based in Canada.
Cybin closed at $0.3331 on May 2. Its 52-week range is $0.2650 to $1.14. Analysts haven’t weighed in yet in May, but of the five watching the stock in April, three rated it a buy and two rated it a strong buy, for a consensus rating of strong buy. The average 12-month price target is $4.38.
4. Freeline Therapeutics
- Price: $0.31
- Market Cap: $20.2 million
- Consensus Rating: Strong Buy
Freeline Therapeutics (Nasdaq:FRLN) develops gene therapies for people with chronic and debilitating illnesses such as hemophilia and lysosomal storage disorders. Its gene therapy targets the liver to then be secreted throughout the circulatory system.
Freeline Therapeutics’ stock closed at $0.31 per share on May 2, near its 52-week low of $0.30. The highest it has traded at in the past year is $1.18. Six analysts followed Freeline in April. Of those, four rated it a strong buy and two rated it a buy, consistent with the previous month. The average 12-month price target is $1.50.
5. AVROBIO
- Price: $0.6250
- Market Cap: $28.75 million
- Consensus Rating: Buy
AVROBIO (NASDAQ:AVRO) is another gene therapy company that hopes to halt or reverse genetic diseases and give patients the ability to live longer without painful and debilitating symptoms and without chronic treatment regimens. The diseases currently being targeted by AVROBIO include Gaucher disease, Hunter syndrome, cystinosis and Pompe disease.
AVROBIO closed at $0.6250 on May 2, closer to its 52-week low of $0.56 than its 52-week high of $1.90. Four analysts follow the company and predict an average 12-month price target of $3.92. Two of those analysts call it a buy and two rate it a strong buy.
6. OncoCyte
- Price: $0.2679
- Market Cap: $31.96 million
- Consensus Rating: Buy
OncoCyte (Nasdaq:OCX) develops diagnostic tests to enable physicians to provide better treatment options for cancer. One product, which is currently available, is a test to identify patients with non-squamous non-small cell lung cancer who may be at risk of recurrence.
OncoCyte has a 52-week range of $0.20 to $1.345 and closed at $0.2679 on May 2. Four analysts follow the stock, and one rated it a strong buy and three rated it a buy, The average 12-month price target is $0.45.
7. Mogo
- Price: $0.69
- Market Cap: $51.73 million
- Consensus Rating: Strong Buy
Mogo (Nasdaq:MOGO) is a Canadian company that develops technologies and products to help Canadians build wealth and achieve financial freedom. The Mogo app helps consumers track and manage their finances.
Mogo stock closed at $0.69 on May 2, closer to its 52-week low of $0.4040 than it’s 52-week high of $2.10. Of the two analysts who followed the company in April, one rated it a strong buy and one rated it a buy. The average 12-month price target is $3.99.
8. Organigram
- Price: $0.4827
- Market Cap: $155.06 million
- Consensus Rating: Buy
Organigram (Nasdaq:OGI) is a Canadian producer of medical and recreational cannabis. The company has three cultivation and production facilities, including an indoor growing facility, a manufacturing site for edibles and a greenhouse facility. The company uses a proprietary system to track grow cycles by strain, environmental conditions, harvest period and other factors, allowing it to optimize cultivation and harvesting.
Organigram stock closed at $0.4827 on May 2. Over the past 52 weeks, its share price has ranged from a low of $0.4680 to a high of $1.49. Just one analyst has followed the stock over the last few months, and they rate it a buy. The average 12-month price target is $2.02.
Final Take
Most of these companies are in the medical sector, including biotechnology, pharmaceuticals, therapies and more. Companies in this sector have the potential to be very successful and provide significant returns to their investors, but the failure rate is high.
When deciding which penny stocks to buy, be sure to carefully research the company to make sure you understand the product or service they offer, their potential for success and the competitive landscape in which they operate. And penny stocks should be a “recreational” investment — this is not the place to put your retirement savings or the kids’ college fund. That said, large returns are possible, especially if you do your homework.
FAQ
- What is a good stock to buy under $5?
- For a good stock under $5, consider Pitney Bowes Inc. (PBI). Currently trading at just $3.31, this shipping and mailing company has been around since 1920 and has an average one year price target of $5.33.
- What are the best $2 stocks to buy?
- While $2 stocks are still considered penny stocks and therefore risky, Pixelworks, Inc. (PXLW) and Bolt Biotherapeutics, Inc. (BOLT) are both valued under $2 and have buy ratings from analysts.
- What are the best stocks under $10?
- One stock to consider in the under-$10 range is Crescent Point Energy Corp. (CPG). It currently trades at $6.86 with a one-year price target of $10.62 and a consensus buy rating from analysts.
- What are some good stocks to buy right now?
- The stocks listed above are good choices to start with, but it's important to assess your risk tolerance and goals before investing. Consider blue chip stocks, like Apple or Pfizer, for more security – but keep in mind that success is never guaranteed with any investment.
Daria Uhlig contributed to the reporting for this article.
Information is accurate as of May 2, 2023, and is subject to change.
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