10 Best Value Penny Stocks to Buy According to Hedge Funds

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6. Petco Health and Wellness Company Inc. (NASDAQ:WOOF)

Number of Hedge Fund Holders: 22

Petco Health and Wellness Company Inc. (NASDAQ:WOOF) is one of the best value penny stocks to buy according to hedge funds. On June 3, Petco announced its FQ1 2026 financial results, reporting net sales of $1.5 billion and a return to positive comparable sales growth of 0.7%. CEO Joel Anderson noted that these results validate the company’s “Reach for the Sky” strategy, highlighting strong performance in its consumables and services businesses as key drivers of growth.

The company saw an increase in gross profit to $574.4 million and a significant rise in operating income, despite reporting a net loss of $15.1 million for the period. Additionally, Petco successfully reduced its total debt to $1.482 billion compared to the previous year and finished the quarter with $166.8 million in cash.

Following this strong start, Petco Health and Wellness Company Inc. (NASDAQ:WOOF) reaffirmed its full-year 2026 outlook while guiding for the second quarter. Management remains focused on strengthening retail fundamentals and improving profitability, noting that its current projections account for stable economic conditions, ongoing tariff impacts, and elevated fuel costs.

Petco Health and Wellness Company Inc. (NASDAQ:WOOF) is a retailer of pet-oriented products and services, operating more than 1,500 stores across the US, Mexico, and Puerto Rico. The company provides services such as veterinary care, grooming, training, tele-health, and pet health insurance services, while its products include pet consumables and supplies.

While we acknowledge the potential of WOOF to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than WOOF and that has 100x upside potential, check out our report about the cheapest AI stock.

Click to continue reading and see the 5 Best Value Penny Stocks to Buy According to Hedge Funds.

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