In this piece, we will take a look at the 12 high growth penny stocks that are profitable. For more penny stocks, head on over to 5 High Growth Penny Stocks that are Profitable.
Investing in the stock market provides the chance for great returns and great losses depending on the nature of the bets made and the timing of the decision. For instance, if you had invested in the tech sector after the coronavirus market crash, you’d have seen strong returns, but those that invested in the sector last year were nearly bled dry as the weak macroeconomic environment pummeled high growth stocks and awarded investors like Warren Buffett who choose to play with stable and safe companies
One sector of the market that has both these features is the penny stock segment. Penny stocks, which are usually priced under $5, provide an attractive entry point for the investor on a budget. While they also provide the opportunity for outsized returns, those that have bought the shares can find it difficult to sell them too due to low liquidity. Not to mention, picking penny stocks is a tricky process too, since sudden share price jumps can be indicative of a pump and dump scam instead of a firm’s true fundamentals driving up the share price.
In fact, the penny stock sector is also at the heart of one of the more well known stock market scams in U.S. history. Former investor Jordan Belfort, who set up his own securities firm in New York, The Stratton Oakmont, is now known as the ‘Wolf of Wall Street.’ The wolf’s line of operations was rather simple – cold call high net worth individuals, start off by pitching the shares of Eastman Kodak Company (NYSE:KODK) (which, coincidentally, is also a penny stock now. . .) and then entice them to buy penny stocks to drive their share price up.
Over time, he set up his own ‘investment firm’ with 150 employees who on average earned $85,000 a year in the 1990s. roughly equivalent to $190,000 today. Mr. Belfort himself did much better, pocketing as much as a whopping $50 million in a year. The Stratton Oakmont ‘boiler room’ would end up scamming more than $200 million from 1,513 investors according to legal claims, and Mr. Belfort, after being released from prison, would end up selling the rights to his memoir for $500,000.
However, even though Mr. Belfort has now changed his ways and is a motivational speaker, penny stock scams are still, should we dare say, a dime a dozen these days. For instance, the SEC entered a settlement with a Vancouver businessman for $5 million in February 2023 after alleging a pump and dump scheme that saw him and his partners promote penny stocks and then sell insider shares. The businessman, Graham Taylor, does not admit or deny his role in the scheme, but he has been permanently banned from promoting penny stocks.
Today, we’ll look at some profitable penny stocks that are growing their revenue, with the top picks being Precigen, Inc. (NASDAQ:PGEN), The Lion Electric Company (NYSE:LEV), and Castor Maritime Inc. (NASDAQ:CTRM).
Our Methodology
We used a stock screener to first find out which stocks are trading for less than five dollars. These were then sifted out through an annual quarterly sales growth of 30% and a net profit margin higher than 25% to create a list of sixteen companies. The firms are ranked based on their quarterly annual sales growth. The sales growth figure has been checked manually to ensure there are no incorrect values. For more penny stocks, you can check out 13 Most Undervalued Penny Stocks.
High Growth Penny Stocks that are Profitable
12. Barnwell Industries, Inc. (NYSE:BRN)
Q/Q Sales Growth: 38%
Number of Hedge Fund Holders in Q4 2022: 2
Barnwell Industries, Inc. (NYSE:BRN) is an oil and gas company. The firm is headquartered in Hawaii, and it produces both gas and oil, alongside providing water drilling and pumping services. Its oil exploration facilities are primarily located in Canada.
Barnwell Industries, Inc. (NYSE:BRN)’s first quarter which ended in December 2022 enabled the firm to bring in $7.5 million in revenue for a 38% annual growth. The firm also posted $1 million in net income for the same time period. As of Q4 2022, 2 of the 943 hedge funds part of Insider Monkey’s research had invested in the company.
Barnwell Industries, Inc. (NYSE:BRN)’s largest investor is Jim Simons’ Renaissance Technologies which owns 389,722 shares that are worth $1.1 million.
Along with The Lion Electric Company (NYSE:LEV), Precigen, Inc. (NASDAQ:PGEN), and Castor Maritime Inc. (NASDAQ:CTRM), Barnwell Industries, Inc. (NYSE:BRN) is a profitable penny stock that is also growing its sales.
11. Jiayin Group Inc. (NASDAQ:JFIN)
Q/Q Sales Growth: 55%
Number of Hedge Fund Holders in Q4 2022: 2
Jiayin Group Inc. (NASDAQ:JFIN) is a Chinese financial services firm that serves as a connection medium between financial institutions and small businesses. The firm allows them to communicate with each other, enabling the institutions to spread information about their products and services. It is headquartered in Shanghai, China.
Jiayin Group Inc. (NASDAQ:JFIN)’s third fiscal quarter which ended in September 2022 saw the firm post $125 million in revenue, which marked a strong 55% annual growth. During the same time period, its net income of $95 million grew by a stronger 99% annually. Two of the 943 hedge funds part of Insider Monkey’s Q4 2022 survey had bought the firm’s shares.
Jim Simons’ Renaissance Technologies is Jiayin Group Inc. (NASDAQ:JFIN)’s largest hedge fund investor in our database. It owns a $50,000 stake that comes via 21,896 shares.
10. Sachem Capital Corp. (NYSE:SACH)
Q/Q Sales Growth: 58.9%
Number of Hedge Fund Holders in Q4 2022: 4
Sachem Capital Corp. (NYSE:SACH) is a financial products firm that targets the real estate industry. It offers short term mortgage loans ranging from one to three years, for properties in Connecticut, Florida, Massachusetts, and New York. The firm is based in Branford, Connecticut.
Sachem Capital Corp. (NYSE:SACH) reported $13.5 million in revenue for its third quarter of fiscal 2022, which enabled it to grow net sales by 58.9% annually. Additionally, it posted $4.1 million in net income for the same quarter, for 20% annual growth. By the end of last year’s December quarter, four of the 943 hedge funds part of Insider Monkey’s survey had bought a stake in the company.
Sachem Capital Corp. (NYSE:SACH)’s largest hedge fund shareholder is Paul Marshall and Ian Wace’s Marshall Wace LLP which owns 353,081 shares that are worth $1.1 million.
9. Uxin Limited (NASDAQ:UXIN)
Q/Q Sales Growth: 78.9%
Number of Hedge Fund Holders in Q4 2022: 2
Uxin Limited (NASDAQ:UXIN) is a software company that provides an online retailing platform in China allowing customers to buy and sell used cars. It also provides other services related to the industry such as warehousing and inspection. The firm is headquartered in Beijing, China.
Uxin Limited (NASDAQ:UXIN) raked in $87 million in revenue during its September 2022 quarter, enabling it to post a 78.9% annual growth. By the Q4 of 2022 end, two of the 943 hedge funds profiled by Insider Monkey had also invested in the firm.
Uxin Limited (NASDAQ:UXIN)’s largest investor is Lei Zhang’s Hillhouse Capital Management which owns 191,563 shares that are worth $551,701.
8. New Concept Energy, Inc. (NYSE:GBR)
Q/Q Sales Growth: 80.7%
Number of Hedge Fund Holders in Q4 2022: 1
New Concept Energy, Inc. (NYSE:GBR) is a real estate company that owns land and provides consultancy services to the energy industry. It is based in Dallas, Texas.
New Concept Energy, Inc. (NYSE:GBR) reported $47,000 in revenue for its quarter that ended in June 2022, marking an 80.7% annual growth. Only one of the 943 hedge funds part of Insider Monkey’s fourth quarter of 2022 survey had bought its shares.
This investor is Israel Englander’s Millennium Management which owns 24,068 shares worth $26,000.
8. Great Elm Group, Inc. (NASDAQ:GEG)
Q/Q Sales Growth: 84%
Number of Hedge Fund Holders in Q4 2022: 8
Great Elm Group, Inc. (NASDAQ:GEG) is a mix of healthcare equipment and investment services firms. It sells air pressure equipment, ventilators, and other products. The firm is based in Waltham, Massachusetts.
Great Elm Group, Inc. (NASDAQ:GEG) grew its revenue by 84% during its second quarter of fiscal 2023, enabling it to post $1.9 million in net sales. Insider Monkey’s Q4 2022 943 hedge fund survey revealed that eight had held a stake in the company.
Great Elm Group, Inc. (NASDAQ:GEG)’s largest investor as of December 2022 is Matthew Drapkin and Steven R. Becker’s Becker Drapkin Management which owns 3.5 million shares that are worth $7.1 million.
7. OptimumBank Holdings, Inc. (NASDAQ:OPHC)
Q/Q Sales Growth: 89.6%
Number of Hedge Fund Holders in Q4 2022: 1
OptimumBank Holdings, Inc. (NASDAQ:OPHC) is an American regional bank that is based in Fort Lauderdale, Florida. It is a consumer and commercial bank that offers accounts, working capital finance, and other services.
OptimumBank Holdings, Inc. (NASDAQ:OPHC)’s third fiscal quarter saw it earn $5.4 million in total interest income, enabling a 89.6% annual growth. The bank also posted $673,000 in net earnings. Insider Monkey analyzed 943 hedge fund holdings for last year’s fourth quarter and found out that one had held a stake in OptimumBank Holdings, Inc. (NASDAQ:OPHC).
This lone investor is Jim Simons’ Renaissance Technologies which owns 62,890 shares that are worth $257,000.
Precigen, Inc. (NASDAQ:PGEN), OptimumBank Holdings, Inc. (NASDAQ:OPHC), The Lion Electric Company (NYSE:LEV), and Castor Maritime Inc. (NASDAQ:CTRM) are some high growth and high profit penny stocks.
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Disclosure: None. 12 High Growth Penny Stocks that are Profitable is originally published on Insider Monkey.