10 Best Penny Stocks to Buy According to Hedge Funds

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In this article, we will look at the 10 Best Penny Stocks to Buy According to Hedge Funds.

On October 7, Ashley MacNeill, Head of Equity Capital Markets at Vista Equity, appeared on CNBC’s ‘Closing Bell’ to talk about the equity market.

She stated that she is remaining “responsibly bullish” on the market, which entails being measured in one’s approach, recognizing that being in an AI bubble is acceptable, and being mindful of the market’s tailwinds.

READ ALSO: 13 Most Undervalued Retail Stocks to Invest In and 14 Biotech Stocks with High Potential

These include considering the Fed’s cuts, retail inflows, AI innovation, and the upcoming earnings cycle, which, by all accounts, is expected to be particularly strong, especially when compared to the last earnings cycle.

With these trends in view, let’s look at the best penny stocks to buy according to hedge funds.

10 Best Penny Stocks to Buy According to Hedge Funds

Our Methodology

We used stock screeners to make a list of the best stocks with a stock price less than $5 and selected the top 10 with the highest number of hedge fund holders as of Q2 2025. We sourced the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund holders.

Note: All data was sourced on October 9.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

10 Best Penny Stocks to Buy According to Hedge Funds

10. Wipro Limited (NYSE:WIT)

​Stock Price: $2.70

Number of Hedge Fund Holders: 19

Wipro Limited (NYSE:WIT) is one of the best penny stocks to buy according to hedge funds. CLSA analyst Sumeet Jain maintained a Buy on the stock with a price target of INR265, on October 3.

In other news, Wipro Limited (NYSE:WIT) announced on September 15 that it entered into an expanded partnership with CrowdStrike for the launch of Wipro CyberShield MDR, which is “an AI-powered unified managed security service (MSS) that simplifies and strengthens enterprise security operations”.

Management stated that CyberShield MDR employs a modern SOC to deliver industry-leading capabilities, providing AI-driven automation, enhanced visibility, and higher efficiency.

Wipro Limited (NYSE:WIT) is a global information technology, consulting, and outsourcing company involved in the development and integration of solutions.

The company’s operations are divided into the following segments: Information Technology Services, India State Run Enterprise Services, and Information Technology Products.

9. BlackBerry Limited (NYSE:BB)

​Stock Price: $4.79

Number of Hedge Fund Holders: 20

BlackBerry Limited (NYSE:BB) is one of the best penny stocks to buy according to hedge funds. On October 3, CIBC analyst Todd Coupland reiterated a bullish stance on BlackBerry Limited (NYSE:BB), giving the stock a buy rating with a $6.00 price target.

BlackBerry Limited (NYSE:BB) reported in its fiscal Q2 2026 results that the total company revenue for the quarter surpassed prior guidance at $129.6 million, reflecting a growth of 3% year-over-year.

Management further reported that total company GAAP and adjusted gross margin rose by 4 percentage points year-over-year to 75%. QNX revenue for the quarter also exceeded guidance, achieving a 15% year-over-year growth to $63.1 million.

BlackBerry Limited (NYSE:BB) provides intelligent security software and services. The company’s operations are divided into the following segments: Cybersecurity, Internet of Things (IoT), and Licensing and Other.

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