I believe that diversification is an excellent strategy to protect oneself when investing. One important aspect of that is risk tolerance. Simply chasing the safest, most risk-avoidant investments is going to lead to one thing: low returns. That’s where penny stocks come in with higher risks, but potential for higher rewards.
I absolutely suggest investors understand and consider exchange-traded funds (ETFs) and other lower-risk investment vehicles. But it’s also necessary to include a degree of risk in a portfolio. Penny stocks are a relatively inexpensive way to approach this strategy.
A few weeks ago, I wrote an article about penny stocks listed on the Nasdaq exchange. Those shares are much more vetted than over-the-counter (OTC) listings.
The same is true of the New York Stock Exchange (NYSE), which is where all of the penny stocks I’ll write about today are listed. Both the Nasdaq and NYSE are centralized, and participants must file periodic audited financial reports. Thus, it is possible to verify their claims regarding their business performance. OTC stocks, on the other hand, are much easier to manipulate.
Here’s another reason to be cautious with OTC penny stocks, according to Kiplinger:
“The major exchanges also have listing requirements; OTC stocks don’t. For example, a company must have at least 400 shareholders and a market value of at least $40 million to get a listing on the New York Stock Exchange. The OTC market makes no such requirements.”
With that in mind, let’s look at these seven NYSE-listed penny stocks that look particularly promising: Gerdau (NYSE: GGB )
Ion Geophysical Corp. (NYSE: IO )
Team Inc. (NYSE: TISI )
Regis Corp. (NYSE: RGS )
Invacare Corp. (NYSE: IVC )
Arcos Dorados Holdings (NYSE: ARCO )
Exterran Corp. (NYSE: EXTN )
Penny Stocks: Gerdau ( GGB )
Source: casa.da.photo / Shutterstock.com Gerdau is a Brazilian steel producer with operations throughout Brazil, North America and South Africa. It produces products like rebar, rolled steel, structural steel and slab steel.
There are a few reasons to be interested in steel stocks right now. Probably the most important is that in the United States, there’s a massive push to revitalize infrastructure.
Earlier this month, President Joe Biden revealed his plan to spend $2 trillion to rebuild crumbling roads and bridges across the U.S. According to President Biden, that spending will lead to 20,000 miles of roads and 10,000 bridges being fixed. That of course requires steel, which bodes well for Gerdau.
In the second quarter, Gerdau was a strong performer. The company saw revenue increase by 119% on a year-over-year (YOY) basis in the quarter. It also saw gross profit rise by a whopping 654%.
The company will release Q3 results in late October. No one knows what the results will be, but analysts are keen on the company currently.GGB stock carries a strong buy rating and lots of upside based on target prices. It currently trades for about $5, the upper limit of a penny stock, but analysts’ consensus target price is $7.93.Given the tailwinds inherent in Biden’s infrastructure spending, it’s easy to see why a growing company like Gerdau carries more than 50% upside now. Ion Geophysical Corp. ( IO ) Source: Shutterstock Ion Geophysical is a Houston Exploration and Production (E&P) firm in the oil industry. One interesting aspect of the company compared to other oil stocks is that it has lower fixed costs. Ion is a data firm, so it doesn’t have to pay for things like mining rigs, pipelines, platforms and all of the other high-cost assets associated with oil drilling.Therefore, the narrative underpinning an IO stock investment is that it’s a play at low-cost, well-regarded oil analytics firm.In fact, Ion Geophysical is covered by three analysts, all of whom consider it to be buy worthy. Their price predictions alone make IO shares very attractive. IO stock currently costs $1.41, but its average target price is three times higher at $4.57. In other words, analysts think it can return 224% to investors right now.Ostensibly, oil producers should be very interested in Ion Geophysical’s services right now as oil prices surge, jumping above $85 per barrel.The company was hit hard by the pandemic. In Q1 2020, revenue hit $56.4 million, then declined to $14 million in Q1 2021. Even so, the company remained profitable due to its asset-light nature. Penny Stocks: Team Inc. ( TISI ) Source: Shutterstock Like Ion Geophysical, Team Inc. is a company that deals with analytics and serves the oil industry. Basically, the company deals with asset assurance and optimization. That means […]
source 7 Most Promising Penny Stocks to Buy Before 2021 Ends