On January 28, SlateStone Wealth chief market strategist Kenny Polcari discussed small-cap stock performance on FOX Business Network’s ‘Making Money.’ Small-cap and equal-weight stocks have been performing exceptionally well throughout the year. However, a sense of anxiety resurfaced among investors.
Polcari noted that when this occurs, investors typically retreat to the perceived safety of large-cap stocks, focusing on growth, core, momentum, and quality names. While the conservative segment of the market looks toward quality names, most seek refuge in growth and momentum.
Talking about the market turnaround, Polcari explained that the shift toward large-cap stocks makes sense because people seek the security of industry leaders when they feel anxious. Despite this, he emphasized that small caps have significantly outperformed this year.
While they have recently dipped from their peaks, they continue to outperform expectations. Polcari advised investors that they must be prepared to ride the wave of volatility associated with these names, as he expects their outperformance to continue.
Against this backdrop of shifting risk appetite, we’re here with a list of the 10 best up and coming penny stocks to buy.
Our Methodology
We used screeners to identify stocks that have gone public in the last 5 years and are trading below $5 per share, and then limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
Note: All data was sourced on February 24.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10 Best Up and Coming Penny Stocks to Buy
10. 60 Degrees Pharmaceuticals Inc. (NASDAQ:SXTP)
60 Degrees Pharmaceuticals Inc. (NASDAQ:SXTP) is one of the best up and coming penny stocks to buy. On February 2, 60 Degrees Pharmaceuticals announced a partnership with GoodRx to enhance the affordability and accessibility of ARAKODA (tafenoquine), the only FDA-approved, once-weekly prescription medication for malaria prevention in the US. The collaboration allows eligible patients to save up to 30% on the treatment at over 70,000 pharmacies nationwide.
This initiative is a key part of the company’s strategy to lower out-of-pocket costs for international travelers heading to malaria-endemic regions. ARAKODA was originally developed by the Walter Reed Army Institute of Research and features a long terminal half-life of approximately 16 days, which supports its convenient weekly dosing schedule.
The treatment regimen involves a three-day loading phase before travel, followed by weekly doses during the stay and a final dose upon return. Beyond its primary use for travelers, the drug represents a significant advancement in the prevention of malaria, a life-threatening disease transmitted by the Anopheles mosquito. Despite its benefits, the company emphasizes strict safety protocols, requiring G6PD deficiency testing for all patients before prescription to avoid the risk of hemolytic anemia.
60 Degrees Pharmaceuticals Inc. (NASDAQ:SXTP) is a specialty pharmaceutical company that develops and commercializes therapies for the prevention and treatment of infectious diseases in the US. It offers ARAKODA for malaria preventative treatment.
9. Atlantic International Corp. (NASDAQ:ATLN)
Atlantic International Corp. (NASDAQ:ATLN) is one of the best up and coming penny stocks to buy. On February 2, Atlantic International appointed Kevin J. Murphy, CPA, as its new Chief Financial Officer. This leadership change coincides with a major period of expansion for the company, following its acquisition of Circle8 Group, which is a prominent European IT and technology staffing firm.
The merger has transformed Atlantic International into a global workforce solutions platform with ~$1.2 billion in unaudited annual revenue, expanding its operations significantly across North America and into key European markets. Murphy joins the company with over 25 years of senior financial leadership experience across the staffing, technology, and data services industries. Most recently, he served as Executive Vice President and Division CFO of Hospitality Staffing Solutions, where he also functioned in a CEO capacity and delivered 17% revenue growth over two years.
In his new role, Murphy will focus on scaling the Atlantic platform and integrating the high-growth technology capabilities added through the Circle8 acquisition. The CEO of Atlantic International Corp. (NASDAQ:ATLN) highlighted Murphy’s operational mindset and capital markets discipline as essential assets for the company’s next chapter of growth.
Atlantic International Corp. (NASDAQ:ATLN) operates as a staffing company servicing the commercial, professional, finance, direct placement, and managed service provider verticals.
