Yahoo Finance Markets Reporter Josh Schafer joined “Asking for a Trend” with Josh Lipton to discuss important points from the trading session on August 21, Thursday. US stocks closed lower, with the S&P 500 declining for a fifth consecutive day.
Schafer noted that there is a “rotation” happening as investors move money from some types of stocks to others.
According to Schafer, tech stocks and utilities were leading previously, but now, these stocks have not been performing well.
Schafer noted that the small caps are performing better. He pointed out that the small-cap Russell 2000 moved a bit higher, even though the S&P 500 went down.
September is expected to be an important month. Investors continue to look for more proof that supports the interest rate cut by the Federal Reserve. Schafer believes that small caps and the Russell 2000 could do well if interest rates come down.
Schafer said that how the market moves next will depend a lot on what happens with interest rates and Federal Reserve Chair Jerome Powell’s speech. He pointed out that, unlike many other indexes, the Russell 2000 has not yet hit a record high in this bull market.
With this background in mind, let’s take a look at the 10 best penny stocks to buy for the next 5 years.
A Traders Desk showing different stocks, with traders hands hovering above the screen.
Our Methodology
To compile our list of the 10 best penny stocks to buy for the next 5 years, we used the Finviz stock screener to find stocks with a share price of under $5 as of August 21, 2025. Then, we sorted our results based on market capitalization and looked for stocks with a year-over-year revenue growth rate exceeding 30% and a compound annual growth rate (CAGR) in revenue exceeding 20% over the past 3 years. To ensure the reliability of our findings, we also consulted Seeking Alpha to confirm the year-over-year revenue growth rate and the 3-year revenue growth rate for each company.
Next, we focused on the top 10 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q1 2025 database of 1,000 elite hedge funds. Finally, the 10 best penny stocks to buy for the next 5 years were ranked in ascending order based on the number of hedge funds holding stakes in them as of Q1 2025.
Why do we care about what hedge funds do? 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 for the Next 5 Years
10. Ur-Energy Inc. (NYSEAMERICAN:URG)
Year-Over-Year Revenue Growth: 149.20%
3-Year Revenue CAGR: 1,021.42%
Share Price: $1.24
Number of Hedge Fund Holders: 11
Ur-Energy Inc. (NYSEAMERICAN:URG) ranks among the best penny stocks to buy for the next 5 years. On August 6, H.C. Wainwright reiterated a Buy rating on Ur-Energy Inc. (NYSEAMERICAN:URG) with a price target of $2.70.
This decision came after Ur-Energy Inc. (NYSEAMERICAN:URG) shared its financial and operating results for the second quarter of 2025.
In the second quarter, the company dried and packaged 112,033 pounds of triuranium octoxide (U3O8), up 35% compared to the first quarter of 2025. Ur-Energy Inc. (NYSEAMERICAN:URG) sold 165,000 pounds of U3O8 in the second quarter and generated $1.9 million in gross profit.
The company also reported good progress in cost savings, reducing the cost per produced pound sold from $62.06 in Q4 2024 to $50.89 in Q2 2025. Improvements in production costs are expected to continue as Ur-Energy Inc. (NYSEAMERICAN:URG) ramps up operations at key sites like Lost Creek.
Additionally, the company has secured long-term sales agreements, which will provide steady income. Ur-Energy Inc. (NYSEAMERICAN:URG) has significant uncontracted production capacity through 2033. This positions the company well, especially as the US Department of Energy low-enriched uranium and high-assay low-enriched uranium programs present additional opportunities for uranium sales.
Ur-Energy Inc. (NYSEAMERICAN:URG) is a uranium mining company. It focuses on uranium mining, recovery and processing operations, as well as the exploration and development of uranium mineral properties.
9. Gevo, Inc. (NASDAQ:GEVO)
Year-Over-Year Revenue Growth: 341.75%
3-Year Revenue CAGR: 445.13%
Share Price: $1.61
Number of Hedge Fund Holders: 14
Gevo, Inc. (NASDAQ:GEVO) ranks among the best penny stocks to buy for the next 5 years. On August 12, H.C. Wainwright reiterated a Buy rating on Gevo, Inc. (NASDAQ:GEVO) with a price target of $14.
This decision came after the company reported its second-quarter results for 2025. Gevo, Inc. (NASDAQ:GEVO) reached a landmark milestone by reporting positive net income for the second quarter of 2025. The company also achieved its goal of positive Adjusted EBITDA for the second quarter and the first half of 2025.
Gevo, Inc. (NASDAQ:GEVO) increased its revenue by $14 million compared to Q1 2025. This growth was driven in part by the start of the company’s Carbon Dioxide Removal credit sales, which added a new stream of revenue for the company.
The company also started to monetize Clean Fuel Production Credits (CFPC), which include sales from low-carbon ethanol with carbon capture and storage (CCS) and renewable natural gas (RNG). These sales contributed about $21 million combined to Gevo, Inc.’s (NASDAQ:GEVO) net income and Adjusted EBITDA in the first six months of 2025.
Overall, low-carbon fuels, including low-carbon ethanol, carbon capture, and co-products, and RNG all helped increase the company’s income from operations and Adjusted EBITDA.
Gevo, Inc. (NASDAQ:GEVO) is an American company that develops, manufactures, and markets sustainable, low-carbon biofuel and chemical products.
