The 3 Top Penny Stocks to Watch This Week - One Could Gain Over 1,000%

The best penny stocks can lock in substantial gains for your portfolio with very little initial investment. That's why we're bringing you the top penny stocks to watch this week.

In order to protect your portfolio, it's important to identify penny stocks that have strong financials and a good chance for growth.

3d printingIn 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 VQScore system identifies undervalued stocks with the highest profit potential by looking at a company's earnings potential, growth rate, earnings-per-share acceleration, and market volume.

The VQScore system runs on a scale of 1 to 4.75, with 4 indicating a stock with strong growth potential.

This week, our three top penny stocks have VQScores of at least 4, indicating that they have strong underlying value and a high chance of providing significant gains for investors.

In fact, one could jump over 1,000%.

Here they are...

Top Penny Stock to Watch in July, No. 3: Mizuho Financial Group Inc.

Mizuho Financial Group Inc. (NYSE: MFG) is a Japanese banking holding company based in Tokyo.

Controlling $1.8 billion in assets, Mizuho focuses on retail banking, global asset management, financial strategy, and corporate investment.

These sectors provide a diverse stream of revenue for investors and protect the company from the volatility that often rocks financial companies in turbulent markets.

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Over the last year, Mizuho managed to generate over $57 million in profit while growing earnings by over 2%.

Mizuho currently trades for $3.36. However analysts see the company's stock heading to $4.00 by the end of the year - a 23% gain for investors.

While Mizuho's profit potential is promising, our second penny stock to watch is even better...

Top Penny Stocks to Watch, No. 2: Nano Dimension

Nano Dimension (Nasdaq: NNDM) is an Israeli 3D printing company. In June, the company's stock rose more than 75% after winning new contracts from the U.S. government.

Nano's U.S. subsidiary recently sold its second DragonFly 2020 Pro 3D printer to a top U.S. defense firm. 3D printers are expected to streamline the government's research and development while keeping costs down.

In addition, the company has attained "vendor status" with the U.S. federal government, which means it can now do business directly with federal agencies, such as the Department of Homeland Security.

Nano currently trades for $2.20. However, analysts see these contracts pushing the company's share price to at least $7.00 - a gain of 218%.

A 218% gain is spectacular. However, our top penny stock to watch this week blows this out of the water. It's a little-known educational firm that's on track to provide investors with a return over 1,000%.

Here's our top pick...

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Top Penny Stocks to Watch, No. 1: Ambow Education Holding Ltd.

Ambow Education Holding Ltd. (NYSE: AMBO) is an education and career advancement company. Since going public on June 1, Ambow stock has surged 267%, making it one of the most active penny stocks over the last month.

For its quarterly earnings ended March 31, the company reported a net revenue increase of 36.5%, from $16.7 million to $11.2 million in just the last year. In November 2017, Ambow acquired Bay State College, a Massachusetts college signaling significant growth potential.

Over the last year, Ambow has cut diluted share losses by almost 54%, from $2.2 million to $1 million. With growing profit margins, investors are likely to see even more significant improvements over the next year.

In fact, analysts see Ambow heading to $55.39 in the near future. From today's current price of $4.80, that's a tremendous gain of 1,053%.

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