What are Penny Stocks?
Penny stocks are the way small companies issue securities at a value of $5 per share or less. Both novel and seasoned investors are drawn to the best penny stocks because of their potential for generating very large profits rather quickly.
The History of Penny Stocks
Although penny stocks are primarily traded over the counter and not on major public exchanges, they have been around just as long as the stock market. These securities received the name “penny stocks” because they were originally traded at values less than $1, but they’ve since been defined by the U.S. Securities and Exchange Commission (SEC) to be any stock that trades for less than $5.
Penny stocks often carry a negative connotation because of their long history that includes shell companies, low-quality companies, and pump-and-dump schemes. To combat some of these struggles, many over-the-counter markets would categorize the penny stock companies into tiers based on the amount of information they disclosed to the SEC.
Since the rise of the internet, penny stocks not only remain inexpensive to purchase and trade, but the commissions for brokers have dramatically decreased, allowing for less fees to the investor.
The individual looking to purchase these affordable securities also has the option to research the companies online via hundreds of websites. From online company reports via the SEC’s website, to the company’s financial information and other specialized data, any person can access all he or she needs to make an informed investment regarding the best penny stocks.
The Future of the Best Penny Stocks
While many penny stocks may consist of companies that might never reach their potential, there are some hidden gems. It’s a volatile market, but finding the right stock has the potential bring in significant gains.
When the market is performing well, these companies may be hard to find, so pay attention to trends and research how each company currently performs. For retail investors, the best penny stocks are a great opportunity to chase triple-digit gains without a massive, upfront investment.
That's why we're bringing you the best penny stocks to buy from last week. We'll also show you the one penny stock you need to buy today.
You see, the best penny stocks can generate significant returns in a short amount of time. Just last month, we identified a little-known education company that jumped 267% in one week.
And last week's top penny stock, Aegean Marine Petroleum Network Inc. (NYSE: ANW), climbed 165% on news that the company entered into a partnership with one of the world's largest independent energy groups.
In order to identify penny stocks like this, we use the Money Morning Stock VQScore™ system to find the best stocks under $5 – the SEC's official definition of a penny stock.
The Best Performing Penny Stocks Last Week
After looking at last week's top gainers, we'll show you a penny stock that's on the verge of tremendous growth – and profits.
Here are the top performers from last week…
|Current Share Price
|Last Week's Gain
|Aegean Marine Petroleum Network Inc. (NYSE: ANW)
|Radisys Corp. (Nasdaq: RSYS)
|Ascent Capital Group Inc. (Nasdaq: ASCMA)
|Adamis Pharmaceuticals Corp. (Nasdaq: ADMP)
|Tintri Inc. (Nasdaq: TNTR)
|Prana Biotechnology Ltd. (Nasdaq: PRAN)
|Micronet Enertec Technologies Inc. (Nasdaq: MICT)
|Corindus Vascular Robotics (NYSE: CVRS)
|ParkerVision Inc. (Nasdaq: PRKR)
|SuperCom Ltd. (Nasdaq: SPCB)
While these gains are exciting, they pale in comparison to the profit potential of our top penny stock to buy this week.
The world's greatest stock picker first recommended this stock when it was trading around $1.26 a share. In early January, it rose over 40% – even before factoring in dividends.
The stock has sold off a bit since then – giving investors who missed it the first time around another shot, or giving current shareholders the opportunity to add to their stake.
It's a real company with a real business that's attacking a real problem – one of the world's biggest problems, in fact.
It's a company located very near the world's biggest market.
It's a company that's making real money – and that could end up as a big-premium buyout.
Best of all: It's a stock you can grab for the grand total of about a $2.10 a share.
And it offers a hefty dividend payout – more than 4.5% a share.
Here's our pick...
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Rural Funds Group Is Our Top Penny Stock to Buy This Week
Rural Funds identifies and operates in well-chosen businesses – and has made best-in-class investments to maximize its sales and profits.
The company's revenue comes from long-term leases across four main subsectors: poultry infrastructure, cattle assets, vineyards, and tree-nut (almonds and macadamias) orchards. These high-quality agricultural assets are leased to experienced operators in the region.
As an Australian company, Rural Funds is on the de facto "doorstep" for all of East Asia, and especially China – the world's biggest and fastest-growing major market, and the place where much of the wealth in the developing world is being created.
With this "penny stock," you can grab some of that wealth for yourself.
Organic growth through meeting rising demand in Asia will power Rural Funds' stock price.
But it could just as easily end up as a buyout play – probably at a big premium to its trading price.
Last fall, United Arab Emirates sovereign-wealth fund Mubadala Investment Co. PJSC made a $340 million bid for Select Harvests Ltd., one of Rural Funds' holdings and one of Australia's top almond producers. Select's board shrewdly rejected the offer, saying it "significantly undervalued the company."
In other words, Select's board members understand that – with all the growth to come – the company's value "tomorrow" will be a heck of a lot higher than it is "today."
Add in the dividend payout – the stock was yielding 5.5% at the time of our "Buy" call, and it's still at 4.62% now – and Select's value will keep growing as the company adds to its farming assets.
The fact that Rural Funds is a foreign-listed stock doesn't deter us (we did this special report on buying foreign stocks to help you).
On its face, food may seem like a blasé investment.
But it's a product mankind cannot do without.
Long term, this is a great wealth-building opportunity – at a cheap price.
Rural Funds is just one of many winning stocks that the world's greatest stock picker has identified over the last several years.
Our stock-picking expert has a strategy for blocking out useless coverage and buying the strongest investments before Wall Street catches on. It's a method that he's kept under wraps – and for good reason.
Based on every track record published today, nobody has come close to him.
As of writing this, he's identified over 217 double- and triple-peak gain winners since he began keeping track in August 2011.
This record is 100% genuine and documented.
His secret method has nothing to do with options, reinvested dividends, annuities, certificates, bonds, futures, or any of that baloney.
If you're one of those people who got burned buying stocks in the past... or lost some money on stocks... or just don't want anything to do with them... then stop now and just ignore this.
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