The NASDAQ Stock Market is home to some of the world’s largest companies in the world and also hosts several hundred penny stocks. These companies must meet certain requirements to remain listed on the NASDAQ exchange, including the $1 per share minimum share price thresholds, revenue standards, and market capitalization thresholds. If a company fails to meet these requirements, it may receive noncompliance notifications and eventually be delisted. According to a report by Bloomberg, this year’s market rally has boosted many of the struggling stocks, helping some companies regain compliance with NASDAQ’s listing requirements.
Optimism in U.S. Markets
On December 3, Bloomberg reported that Fed Governor Christopher Waller, while addressing a conference in Washington, indicated that he is inclined to vote for a rate cut at the upcoming Federal Reserve meeting on December 17-18. However, Waller emphasized that his decision will depend on the economic data released before the meeting, particularly if it shows an unexpected uptick in inflation.
According to Bloomberg, New York Fed President John Williams in a speech in New York said that the economy is continuing to look strong and inflation is likely moving down toward the Fed’s target. However, he emphasized that the path for monetary policy will be contingent upon incoming economic data. He underscored the uncertainty of the economic outlook, noting, “If we’ve learned anything over the past five years, it’s that the outlook remains highly uncertain.”
Read Also: 10 Oil Stocks with Biggest Upside Potential According to Analysts and 7 Best Emerging Markets Stocks To Buy Now.
In an interview with CNBC on November 15, Nicholas Colas, Co-founder of DataTrek Research, discussed his views on the US stocks and the potential of small caps. Colas recalled how U.S. stocks outperformed global markets during the first Trump administration. Colas acknowledged that current multiples are high, but he is optimistic and believes that multiples can hold or even rise, given the high level of confidence in the US market. Regarding small caps, Colas suggested that they are a great trade for the year-end. The Russell 2000, which tracks small-cap performance, has been flat and lagged significantly behind the S&P 500 over the past three years, and presents an amazing opportunity, given that it typically sees a 20% increase. This underperformance makes small caps reasonable holds for the longer term, as they are due for a rebound.
While the broader market is showing signs of overvaluation, small-cap, and penny stocks have lagged significantly behind over the past few years, creating a compelling opportunity for investors. With that in context, let’s take a look at the 11 best NASDAQ penny stocks to buy right now.
Our Methodology
To compile our list of the 11 best NASDAQ penny stocks to buy right now, we used Finviz and Yahoo stock screeners to find the 25 largest companies trading below the price of $5 as of December 4. We then used Insider Monkey’s Hedge Fund database to rank 11 stocks according to the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
11 Best NASDAQ Penny Stocks To Buy Right Now
11. Olaplex Holdings, Inc. (NASDAQ:OLPX)
Number of Hedge Fund Holders: 18
Stock Price as of December 4: $2.07
Olaplex Holdings, Inc. (NASDAQ:OLPX) is a premium hair care company known for its patented bond-building technology, which restores and strengthens hair. The company earns revenue through direct-to-consumer sales, salon partnerships, and retail distribution.
Olaplex Holdings, Inc. (NASDAQ:OLPX) is exploring new markets, such as the Lashbond Building Serum Market. The company’s new product, LASHBOND, is designed to enhance the appearance of thicker, longer, and fuller lashes. With its existing client base and reputation, Olaplex Holdings, Inc. (NASDAQ:OLPX) plans to capitalize on this new market opportunity.
Olaplex Holdings, Inc. (NASDAQ:OLPX) is also expanding its presence in the global market through various initiatives. The company is establishing connections with professional distributors worldwide to drive revenue growth. The company is signing agreements with distributors that do not work with competitors, giving the company a competitive edge. This expansion is expected to accelerate the growth of the company’s network outside of the United States.
10. Lucid Group, Inc. (NASDAQ:LCID)
Number of Hedge Fund Holders: 19
Stock Price as of December 4: $2.12
Lucid Group, Inc. (NASDAQ:LCID) designs, manufactures, and sells luxury electric vehicles (EVs) and provides associated services. The company is known for its innovative technology, stunning design, long-range, and exceptional performance.
Lucid Group, Inc. (NASDAQ:LCID) is focused on its upcoming SUV, the Lucid Gravity. On November 7, the company opened customer orders for the car. To support the launch of Lucid Gravity, Lucid Group, Inc. (NASDAQ:LCID) is investing in its brand awareness and go-to-market strategy. The company has seen a significant increase in foot traffic at its studios, with a 70% increase in the past 30 days. This increased awareness is expected to drive demand for both Lucid Gravity and Lucid Air.
Lucid Group, Inc. (NASDAQ:LCID) is also expanding its physical presence, with a growing network of studios and service centers. The company ended the third quarter with 55 studios and service centers, up from 53 in the second quarter, and plans to continue to strategically expand its footprint in the future.
The Lucid Gravity is expected to be a game-changer for the company, with its innovative technology and design set to reshape the market for SUVs. The vehicle has already generated significant interest, with test rides of the Lucid Gravity beta and pre-production vehicles receiving positive feedback. The company is confident that Lucid Gravity will be a major success, with its technology and cost competitiveness set to drive growth and profitability.
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