In this article, we will take a look at the 11 Must-Buy Penny Stocks to Buy Now.

Markets have continued to rally, with the S&P 500 already up by about 15% for the year. Amid the significant gains, analysts at Morgan Stanley and Goldman Sachs have warned of a potential reality check. The sentiments come on equities hitting record highs, thanks to artificial intelligence-driven gains and expectations of interest rate cuts.

“It’s likely there’ll be a 10 to 20% drawdown in equity markets sometime in the next 12 to 24 months,” said Goldman Sachs CEO David Solomon at the Global Financial Leaders’ Investment Summit in Hong Kong. “Things run, and then they pull back so people can reassess.”

Meanwhile, Wells Fargo believes that an aggressive interest rate cut by the US Federal Reserve could fuel demand for riskier assets in the market.

“The Fed’s more aggressive start to its easing cycle also leaves financial markets exposed to increased volatility by encouraging a rotation into risk assets and leveraging, anticipating an early growth recovery vulnerable to rising inflation and higher interest rates,” Wells Fargo wrote in a research note to investors.

While considered risky bets, penny stocks attract significant interest from investors eyeing exposure to smaller or newer firms that can offer long-term growth opportunities at much lower prices. While large-cap technology stocks have driven gains in the US, the focus is slowly shifting towards small-cap and penny stocks, which are likely to benefit from a favorable interest rate environment and discounted investment opportunities.

With that in mind, let’s take a look at some of the must-buy penny stocks to buy now.

Our Methodology

To identify the must-buy penny stocks to buy now, we used the Finviz stock screener along with other online sources to compile a list of companies trading below $5 per share. We narrowed the pool to stocks that have gained over 50% year-to-date (as of November 17), carry Strong Buy ratings from analysts, and are popular among elite hedge funds. We determined the stocks’ popularity using hedge fund holdings data from Q2 2025 13F filings available in Insider Monkey’s database. The list is sorted in ascending order of upside potential.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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).

Must-Buy Penny Stocks to Buy Now

11. AbCellera Biologics Inc. (NASDAQ:ABCL)

Share Price as of November 17: $3.69

Upside Potential: 50.89%

Number of Hedge Fund Holders: 17

AbCellera Biologics Inc. (NASDAQ:ABCL) is a must-buy penny stock to buy now. On November 13, at the Stifel 2025 Healthcare Conference, AbCellera Biologics Inc. (NASDAQ:ABCL) reaffirmed its strategic evolution into a company focused on developing clinical assets. The company will no longer operate under a partnership model but will develop its own assets backed by a strong financial position.

With over $500 million in cash and equivalents, AbCellera is focused on the development of ABCL635, a first-in-class antibody medicine for the non-hormonal treatment of moderate to severe menopausal hot flashes. The company is also working on ABCL575, an antibody for the treatment of moderate-to-severe atopic dermatitis (AD).

Even as the company continues to work on its clinical assets, strategic partnerships with big Pharma, including Eli Lilly and AbbVie, are crucial. The internal clinical assets are only seen as a presale activity for future licensing. Amid the new strategic focus, on November 7, TD Cowen analyst Brendan Smith reiterated a Buy rating, as Stifel Nicolaus analyst Stephen Wiley echoed similar sentiments with a Buy rating and a $7 price target.

AbCellera Biologics Inc. (NASDAQ:ABCL) is a clinical-stage biotechnology company that discovers and develops antibody-based medicines for a range of diseases, including cancer, metabolic and endocrine conditions, and autoimmune disorders.

10. indie Semiconductor, Inc. (NASDAQ:INDI)

Share Price as of November 17: $3.84

Upside Potential: 66.45%

Number of Hedge Fund Holders: 13

indie Semiconductor, Inc. (NASDAQ:INDI) is a must-buy penny stock to buy now. On November 10, UBS resumed coverage of indie Semiconductor, Inc. (NASDAQ:INDI) with a Neutral rating and raised its price target to $5 from $4.50, noting supply-driven earnings shortfalls and cautious December guidance, while highlighting stable ADAS trends but limited upside until a potential earnings inflection in late 2026. Benchmark Co reiterated a Buy rating on the stock on November 7 and set an $8 price target, following better-than-expected third-quarter results.

On November 6, the company delivered strong third-quarter results characterized by a strategic backlog increasing to $7.4 billion. The better-than-expected results underscore the strength of design-win momentum across ADAS and growth in industrial markets, including quantum and robotics.

The company posted $53.7 million in revenue with a non-GAAP gross margin of 49.6%. On the other hand, the company’s operating loss narrowed to $11.3 million compared to $16.8 million in the same quarter last year. With the backlog increasing to $7.4 billion, the company remains on track to become profitable.

During the quarter, Indie Semiconductor successfully designed a Robotaxi for a North American self-driving OEM. It also launched DFB laser products with 10X lower frequency noise for quantum computing applications.

indie Semiconductor, Inc. (NASDAQ:INDI) designs and sells automotive-grade semiconductors and software solutions for driver assistance systems, in-cabin user experience, and vehicle electrification. The company focuses on edge sensors, including LiDAR, radar, ultrasound, and computer vision, and its products are utilized in various automotive applications.