In this article, we will look at the 11 Best Rising Penny Stocks to Buy According to Hedge Funds.
On August 22, Tom Lee, Fundstrat’s head of research and chief investment officer, appeared on CNBC Television to discuss his reaction to Fed Chair Powell’s speech at Jackson Hole, market expectations, and what it all means for small-cap stocks.
Lee sees Jay Powell’s recent remarks as positive, as the Fed acknowledged the risks of a softening labor market and signaled a dovish stance. He noted that this means the Fed no longer views tight labor markets as a primary driver of inflation, which bodes well for the stock market, particularly small-cap stocks. Lee believes that a dovish Fed environment is a green light for small-cap stocks, which have outperformed recently by around 3-4%. He noted that one key indicator to look for is the mortgage rate, as the mortgage spreads are right now 360 basis points higher than the ten-year. Therefore, a potential drop in mortgage rates from the current high spread would boost housing and benefit financial small caps. Similarly, it could also result in the revival of the ISM manufacturing index, which has been below 50.
Lee is optimistic about further market rally potential, targeting an S&P 500 level near 4800 by year’s end, driven by financials and technology sectors.
With that, let’s take a look at the 11 best rising penny stocks to buy according to hedge funds.
Stocks
Our Methodology
To curate the list of 11 best rising penny stocks to buy according to hedge funds, we used the Finviz stock screener, Yahoo Finance, and Insider Monkey’s Q2 2025 database. Using the screener, we aggregated a list of penny stocks (trading under $5) that have gained more than 30% over the past month. Next, we cross-checked the performance from Yahoo Finance and ranked the stocks in ascending order of the number of hedge fund holders, sourced from Insider Monkey’s database. Please note that the data was recorded on August 25, 2025.
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).
11 Best Rising Penny Stocks to Buy According to Hedge Funds
11. Galiano Gold Inc. (NYSEAMERICAN:GAU)
Price: $2.11
1 Month Performance: 40.67%
Number of Hedge Fund Holders: 8
Galiano Gold Inc. (NYSEAMERICAN:GAU) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 20, Galiano Gold Inc. (NYSEAMERICAN:GAU) announced new drilling results from its Abore project at the Asanko Gold Mine in Ghana.
Management noted that the Phase 2 drilling program found several new high-grade gold zones in the Abore South and Main areas. Notably, a new significant high-grade discovery was made at Abore North, which lies below the current mineral resources. Some of the highlights from the discovery include 6.8 grams per tonne over 23 meters and 5.3 grams per tonne over 16.4 meters. Management believes that these findings will help expand the open-pit resources quickly, offering the company promising targets for further exploration.
Galiano Gold Inc. (NYSEAMERICAN:GAU) operates the Asanko Gold Mine in Ghana, which includes multiple open-pit gold deposits and a processing plant.
10. SNDL Inc. (NASDAQ:SNDL)
Price: $2.25
1 Month Performance: 46.10%
Number of Hedge Fund Holders: 9
SNDL Inc. (NASDAQ:SNDL) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On July 31, SNDL Inc. (NASDAQ:SNDL) released its fiscal second-quarter results for 2025. The market has reacted positively following the announcement, as the stock has surged 30.81% since the announcement.
During the quarter, the company delivered a quarterly revenue of $244.8 million, reflecting 7.3% year-over-year growth. Management noted that the key drivers of this growth were the cannabis business, which grew 17.4% and a return to growth within its liquor retail segment. Notably, the gross profits also improved by 16.2% year-over-year to reach $67.6 million.
Looking ahead, management highlighted that they have agreed to acquire 32 cannabis retail stores from 1CM Inc. for $32.2 million, which are expected to close in Q3 2025.
SNDL Inc. (NASDAQ:SNDL) is a vertically integrated company that operates in both the cannabis and liquor retail sectors in Canada. It owns and operates several retail banners selling cannabis products, accessories, wines, beers, and spirits.
9. Ondas Holdings Inc. (NASDAQ:ONDS)
Price: $4.50
1 Month Performance: 110.23%
Number of Hedge Fund Holders: 9
Ondas Holdings Inc. (NASDAQ:ONDS) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 18, Ondas Holdings Inc. (NASDAQ:ONDS) announced that it has agreed to acquire Apeiro Motion in a transaction valued at $12 million. Aperio Motion is an Israeli company specializing in advanced ground robotics and fiber optic communication systems.
Management noted that they plan to operate Apeiro under its Ondas Autonomous Systems business unit and expand the company’s capabilities in ground robotics and secure battlefield communication. This strategic move is also expected to broaden the company’s access to key global defense markets, including the US Department of Defense, NATO, and the EU. The transaction is expected to close in the third quarter of 2025.
Ondas Holdings Inc. (NASDAQ:ONDS) provides private wireless networks and commercial drone solutions.
8. Tilray Brands, Inc. (NASDAQ:TLRY)
Price: $1.15
1 Month Performance: 64.29%
Number of Hedge Fund Holders: 12
Tilray Brands, Inc. (NASDAQ:TLRY) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 21, Breckenridge Distillery, which is part of Tilray Brands, Inc. (NASDAQ:TLRY), announced the launch of a new product called Mountain Shot.
The drink offers a fresh take on whiskey shots by blending smooth chocolate flavors with a cool hint of mint. The special highlight of this drink is the addition of maitake mushrooms, also known as Hen of the Woods, which come from Japan. The mushrooms are said to add a special texture to the drink. Management noted that the product aims to capture the adventurous spirit of the Rocky Mountains. The product is now available in select US markets.
Tilray Brands, Inc. (NASDAQ:TLRY) is a global company that produces and sells cannabis, beverage alcohol, pharmaceuticals, and wellness products. The company owns many brands and offers a wide range of products for adult-use cannabis and other markets.
7. Holley Inc. (NYSE:HLLY)
Price: $3.89
1 Month Performance: 67.67%
Number of Hedge Fund Holders: 12
Holley Inc. (NYSE:HLLY) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 12, Canaccord Genuity analyst Brian McNamara maintained a Buy rating on Holley Inc. (NYSE:HLLY) with a price target of $6.
The analyst noted that he sees strong growth potential and stability for the company, driven by a return to solid industry growth. He added that this growth is fueled by rising vehicle sales and a passionate customer base. Moreover, McNamara also likes the company’s smart mergers and acquisitions strategy, which he believes strengthens its market position.
Although the automotive aftermarket is fragmented, the strategic acquisitions of Holley Inc. (NYSE:HLLY) improve its foothold. The analyst noted that the company generates strong free cash flow, driven by its capital-light business model and attractive gross margins.
Holley Inc. (NYSE:HLLY) designs and manufactures high-performance automotive parts for vehicle enthusiasts. The company offers a wide range of products, including fuel systems, superchargers, exhausts, and engine tuners.
6. United States Antimony Corporation (NYSEAMERICAN:UAMY)
Price: $4.72
1 Month Performance: 31.11%
Number of Hedge Fund Holders: 13
United States Antimony Corporation (NYSEAMERICAN:UAMY) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 13, Heiko Ihle from H.C. Wainwright reiterated a Buy rating on United States Antimony Corporation (NYSEAMERICAN:UAMY) with a price target of $4.5.
The analyst noted that the company has shown strong financial performance in the second quarter of 2025. The company delivered a revenue of $10.53 million, which exceeded expectations by $594,250. The analyst noted that this growth was driven by higher antimony prices, even though sales volume dipped slightly. Moreover, the company maintained a strong inventory position.
The analyst highlighted that he conducted a detailed discounted cash flow analysis of United States Antimony Corporation (NYSEAMERICAN:UAMY) and valued the company and zeolite operations at $482.6 million, which supports his positive outlook.
United States Antimony Corporation (NYSEAMERICAN:UAMY) produces and sells antimony, precious metals like gold and silver, and zeolite products.
5. ATRenew Inc. (NYSE:RERE)
Price: $4.55
1 Month Performance: 35.01%
Number of Hedge Fund Holders: 15
ATRenew Inc. (NYSE:RERE) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 20, ATRenew Inc. (NYSE:RERE) released results for its fiscal second quarter of 2025. Both the revenue and EPS came in above Wall Street targets.
The company delivered a revenue of $695.60 million, reflecting a 31.25% growth year-over-year and ahead of estimates by $31.47 million. The EPS of $0.09 also exceeded expectations by $0.01. Management noted that the growth was driven by stronger online sales of pre-owned electronics and multi-category recycling services. Although the operating cost for the quarter increased by 29.6%, mainly due to higher merchandise, fulfillment, marketing, and personnel expenses, the company expanded operations. However, despite this, the profit grew to $12.7 million, supported by a rising retail revenue proportion and efficient expense management.
ATRenew Inc. (NYSE:RERE) is a leading platform in China for buying, selling, and recycling pre-owned consumer electronics like mobile phones and laptops.
4. Esperion Therapeutics, Inc. (NASDAQ:ESPR)
Price: $2.17
1 Month Performance: 45.64%
Number of Hedge Fund Holders: 16
Esperion Therapeutics, Inc. (NASDAQ:ESPR) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 5, Joseph Pantginis from H.C. Wainwright maintained a Buy rating on Esperion Therapeutics, Inc. (NASDAQ:ESPR) with a price target of $16.
The analyst noted that the company delivered robust performance during its fiscal second quarter of 2025 and beat Wall Street estimates for revenue and EPS. The company delivered a revenue of $82.39 million, reflecting 11.58% year-over-year growth and ahead of estimates by $19.34 million. The EPS of negative $0.02 also topped the consensus by $0.14.
Pantginis highlighted that Esperion Therapeutics, Inc. (NASDAQ:ESPR) saw a huge jump in US product revenue, especially from its NEXLETOL and NEXLIZET drugs. This was mainly driven by more retail prescriptions and higher use among patients who cannot tolerate statins.
Moreover, the company is also expanding globally and has secured approval for its BDA product in 40 countries, with more approvals expected soon.
Esperion Therapeutics, Inc. (NASDAQ:ESPR) develops and sells oral, once-daily, non-statin medicines for people at risk of cardiovascular disease with high LDL cholesterol.
3. Precigen, Inc. (NASDAQ:PGEN)
Price: $4.18
1 Month Performance: 161.25%
Number of Hedge Fund Holders: 16
Precigen, Inc. (NASDAQ:PGEN) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 15, the FDA announced approval for PAPZIMEOS to treat adults with recurrent respiratory papillomatosis. Wall Street has been bullish on the stock since the approval, and the stock has gained more than 40%.
Recently, on August 19, Swayampakula Ramakanth, an analyst from H.C. Wainwright, reiterated a Buy rating on Precigen, Inc. (NASDAQ:PGEN), keeping the associated price target the same at $8.50.
The analyst noted that approval came earlier than expected, creating a positive surprise for the company. The treatment has been approved for treating recurrent respiratory papillomatosis, which affects about 27,000 adults in the United States, indicating a huge market for the drug.
The drug looks promising as the analyst noted sales projections are expected to reach $15 million by the fourth quarter of 2025. Moreover, the company also plans to launch the drug by focusing on key Integrated Delivery Networks and community hospitals.
Precigen, Inc. (NASDAQ:PGEN) is a biopharmaceutical company that develops gene and cell therapies to treat serious diseases.
2. Wheels Up Experience Inc. (NYSE:UP)
Price: $2.17
1 Month Performance: 47.62%
Number of Hedge Fund Holders: 19
Wheels Up Experience Inc. (NYSE:UP) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 21, Wheels Up Experience Inc. (NYSE:UP) announced the sale of three non-core services businesses, including Baines Simmons, Kenyon International Emergency Services, and Redline Assured Security, for about $20 million.
The market has reacted positively to this divestiture as the stock price has surged more than 18% since the announcement. CEO George Mattson, noted that this sale was part of a greater strategy to focus on core operations. The company plans to invest in products, fleet, and improve the balance sheet. Moreover, management also intends to boost operational performance and simplify its business.
Wheels Up Experience Inc. (NYSE:UP) is a private aviation company offering on-demand private flights and membership programs. The company provides access to a large, diverse global fleet through owned, leased, and partner aircraft.
1. Gossamer Bio, Inc. (NASDAQ:GOSS)
Price: $2.34
1 Month Performance: 31.46%
Number of Hedge Fund Holders: 31
Gossamer Bio, Inc. (NASDAQ:GOSS) is one of the Best Rising Penny Stocks to Buy According to Hedge Funds. On August 5, Gossamer Bio, Inc. (NASDAQ:GOSS) provided second-quarter results and a business update, highlighting the completion of enrollment for its Phase 3 PROSERA Study. The Market has taken the update positively, as the share price has surged more than 8.5% since the announcement.
Recently, on August 19, Patrick Trucchio, analyst from H.C. Wainwright, reiterated a Buy rating on Gossamer Bio, Inc. (NASDAQ:GOSS), with a price target of $10. He noted that the 2025 literature review for Seralutinib has increased confidence in the drug’s lasting effects and also confirmed its relevance to right-heart function. The open-label phase two trial showed sustained improvements among patients, as over seventy-two weeks, there was a drop in pulmonary vascular resistance and better six-minute walk distances.
Management expects results from the Phase 3 PROSERA Study in February 2026; analysts believe this would further prove the drug’s long-term safety and effectiveness.
Gossamer Bio, Inc. (NASDAQ:GOSS) is a clinical-stage biopharmaceutical company developing Seralutinib, a drug for treating pulmonary arterial hypertension and pulmonary hypertension linked to interstitial lung disease.
While we acknowledge the potential of GOSS 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 GOSS and that has 100x upside potential, check out our report about this cheapest AI stock.
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