10 Top Penny Stock Gainers to Watch in September 2017

Today, we've ranked the 10 top penny stock gainers of August 2017, all of which will be on our watch list as we move into September 2017. After this list, we'll also give you one of the best small-cap stocks to invest in this year.

Here are the 10 top penny stocks to watch for September 2017:

Penny Stock Current Stock Price August 2017 Gain (as of Aug. 28)
DryShips Inc. (Nasdaq: DRYS) $3.10 +187%
Ion Geophysical Corp. (NYSE: IO) $7.05 +98.6%
CareDx Inc. (Nasdaq: CDNA) $2.62 +97%
China Finance Online Co. (Nasdaq ADR: JRJC) $2.61 +84.5%
Appliance Recycling Centers of America (Nasdaq: ARCI) $1.23 +82.3%
Phoenix New Media Ltd. (NYSE ADR: FENG) $4.38 +63.7%
Tremor Video Inc. (NYSE: TRMR) $3.39 +61.7%
FalconStor Software Inc. (Nasdaq: FALC) $0.33 +58.3%
T2 Biosystems Inc. (Nasdaq: TTOO) $4.15 +57.8%
Chiasma Inc. (Nasdaq: CHMA) $2.10 +55.6%

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top penny stock gainersThe top penny stock of August 2017 has been DryShips Inc., a freight and commodities shipping company whose shares are up 187%, from $1.08 at the July 31 close to $3.10 today. DRYS stock surged 51.2% on Aug. 11 alone after the firm approved a huge sale of shares...

According to the company's official statement, DryShips said it would sell $100 million worth of shares to the company's CEO, George Economou, at $2.75 per share. By buying back shares of his own company, Economou said he will use the proceeds to reduce the company's debt load of $200 million and acquire new cargo vessels.

The DRYS rally marks a strong rebound for the stock, which has been crushed by eight stock splits since March 2016. Shares are down 100% over the last 12 months.

This shows how risky some penny stocks can be. Although DRYS is up 187% so far this month, we don't recommend buying that or any other company listed above. Since these stocks have already posted double- and triple-digit gains, buying in now could set you up for a loss since they're trading at high prices.

Here at Money Morning, we don't advise buying a penny stock just because it's rallying. It's always important to go beyond the gains and dig into the company's financials, including its annual 10-K filing and quarterly earnings.

But Money Morning Small-Cap Specialist Sid Riggs conducts that research for Money Morning Members. He's an expert at finding small stocks with big potential. In fact, one of his recent recommendations has gained 33.2% since he first told readers about it on June 12.

Although many of his picks cost slightly more than the $5 cutoff for penny stocks, they're more expensive for a reason. Their market caps are often between $300 million and $2 billion, which means they're more stable than micro-cap penny stocks.

And today, he's recommending another company that operates in the growing industries of defense and solar. It has also smashed analysts' earnings expectations over the last three quarters.

Here's Sid's pick...

The Best Small-Cap Stock to Buy in 2017

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Sid's stock pick is Intevac Inc. (Nasdaq: IVAC).

Intevac makes sensor-based technology used across several growing industries, including solar energy and defense. For example, its sensors are used in military-grade night vision goggles as well as professional camera equipment. The defense industry alone is expected to see tremendous growth this year, especially if U.S. President Donald Trump follows through on his promise to boost military spending by $54 billion.

And that's not the only industry IVAC operates in. It's also focused on solar power...

Intevac is a big provider of thin-film sensors used in solar panels, with the firm reporting an order of 12 solar ion implant systems in March to a customer in China. That order will enable more than one gigawatt (GW) of solar energy - about the same amount of power as 4.6 million photovoltaic (PV) panels or 100 million LED lightbulbs.

Its sensor sales in the solar industry will likely grow this year as the number of solar panel installations increases. According to Greentech Media, the number of installations this year is projected to rise 88.1% to 410 megawatts.

Not to mention, Intevac has consistently beaten earnings expectations. In Q4 2016 and Q1 2017, the company has surpassed earnings per share estimates by an average of 72.9%. Most recently, in Q2, Intevac earned $0.05 per share, beating analysts who estimated it would break even at $0.00 per share.

All of this is bullish news for the IVAC stock price moving forward. Analysts surveyed by Yahoo Finance say shares could climb as much as 74.9%, from their current $9.15 level to $16 by next August.

The Bottom Line: The double- and triple-digit returns in our top penny stocks list show how profitable these companies can be in a short period of time. But we don't recommend buying any of those companies. Instead, Sid likes Intevac stock, which could end up being one of the best small-cap investments of 2017. Its presence in the booming solar and defense industries - as well as its reputation for crushing earnings estimates - make it a strong pick for your portfolio this year.

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