In this article, we will look at the 9 Must-Buy Penny Stocks to Invest In Now.
A potential breakthrough in the US/Israel-Iran conflict lit fire under Wall Street on April 17. President Trump posted about ceasefire progress, which was confirmed by Iranian authorities, clinching a third straight week of gains for major US indexes. The Dow Jones Industrial Average surged 1.8%, or 869 points, while the S&P 500 and NASDAQ composite each rose more than 1% to notch their third consecutive record high. A Wall Street Journal analysis found that over the three-week stretch to April 17, the S&P 500 and the tech-heavy NASDAQ posted their biggest gains since 2020. The reason is that investors have begun looking past the disruptions of the nearly seven-week-old conflict, WSJ noted.
However, that optimism comes with a giant asterisk. Right after the Iranians confirmed the ceasefire progress, President Trump announced that the US naval blockade on Iranian ports, which was initiated in response to Iran shutting the Strait of Hormuz to hostile ships, would remain in force. For that reason, Charlie Ripley, senior investment strategist at Allianz Investment Management, argued that “significant risks remain on the table.” Though he noted that the shift toward a diplomatic approach has caused fears of a prolonged escalation to subside considerably.
As markets reacted to the pause in hostilities in the Middle East, small cap stocks, which include those trading below $5 and are better known as penny stocks, had the most ground to recover. When the conflict erupted in late February, the Russell 2000 shed 3.18% from its January 22 peak. It entered official correction territory by March 20, which was a reversal for a segment that strategists at Bank of America, JPMorgan, and State Street had tipped to lead markets in 2026. During the strong start to the year, the Russell 2000 had surged more than 8% through late January. The S&P 500 returned a paltry 1.4% over the same stretch.
So, has the geopolitical turbulence permanently clouded the bullish case that experts had built for smaller companies entering 2026? Columbia Threadneedle Investments’ Andrew Smith doesn’t think so. “Despite the significant policy and geopolitical uncertainty, the investment case for US small caps remains intact,” Smith wrote in a March 17 analysis.
Smith noted that bottom-up consensus data compiled by Bloomberg projected that the Russell 2000 would deliver 43% year-over-year earnings growth over the coming 12 months. This is nearly four times the 11% forecast for the large-cap S&P 500. In other words, the conflict in the Middle East merely deferred the bull case for small caps, and once it is resolved, these companies could notch massive gains.
That said, this article discusses several penny stocks investors can buy now.
Our Methodology
To determine the 9 must-buy penny stocks to invest in now, we used the Finviz stock screener to filter for stocks trading under $5. From there, we identified stocks with strong analyst sentiment and then selected those with at least 30% upside potential as of April 17. Moreover, we focused on stocks that have recently had significant news events. We also factored in hedge fund ownership as of Q4 2025 using the Inside Monkey database. Finally, we ranked the stocks based on their price upside potential, according to analysts.
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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
Must-Buy Penny Stocks to Invest In Now
9. VinFast Auto Ltd (NASDAQ:VFS)
Number of Hedge Fund Holders: 5
Upside Potential: 38.48%
Stock Price: $5.83
VinFast Auto Ltd (NASDAQ:VFS) is among the must-buy penny stocks to invest in now. The stock has gained more than 47% over the past month.
On April 13, VinFast announced that it delivered 27,609 electric vehicles in March 2026 in its domestic Vietnam market, representing an increase of 127% YoY. The company estimates its Q1 2026 deliveries in Vietnam reached 53,684 vehicles. The best-selling models for the month of March and Q1 were Limo Green and VF 3. The management said the deliveries underscored VinFast’s leadership in the domestic vehicle market.
On March 23, Cantor Fitzgerald reaffirmed its Overweight stock rating on VinFast Auto Ltd (NASDAQ:VFS) stock, citing strong delivery guidance numbers. The firm pointed to VinFast’s targets to deliver 300,000 vehicles in 2026, above the consensus projection of 212,767 vehicles. The 2026 delivery target also indicates a sharp increase from the 2025 deliveries of 197,000 vehicles.
The firm also noted VinFast’s expansion plans. In 2026, the Vietnamese electric vehicle maker aims to double its Indian dealer footprint and expand its dealer partnerships in the Philippines and Indonesia. VinFast also plans US launches, including an electric bus.
In its domestic Vietnam market, VinFast controlled around 36% market share in the passenger vehicle segment in 2025, making it the market leader. In the category of all-battery electric vehicle brands, Vietnam ranked second in the Philippines, third in Indonesia, and fourth in India.
The company is also working on expanding its presence in the two-wheeler segment in Asian markets. It also has its eyes set on the robotaxis and humanoids, with plans to expand into these markets over the next few years.
VinFast Auto Ltd (NASDAQ:VFS) is an automaker based in Vietnam. It produces a variety of electric vehicles, including electric cars, electric buses, and electric scooters. VinFast Auto has multinational operations and continues to expand into more global markets.
8. Coty Inc (NYSE:COTY)
Number of Hedge Fund Holders: 35
Upside Potential: 44.49%
Stock Price: $2.36
Coty Inc (NYSE:COTY) is among the must-buy penny stocks to invest in now. Coty Inc (NYSE:COTY) is undertaking a strategic review of its consumer beauty business. However, the company told Reuters on April 16 that it was not in talks to sell its prestige brands. This was in response to a media story that Coty was looking to sell its Hugo Boss and Burberry brands to a Paris-based company called Interparfums. Interparfums also came out to deny that it was involved in discussions to purchase the Coty brands, according to the Reuters report.
Under the interim CEO Markus Strobel, Coty is working on turning around its performance. This effort includes focusing on core brands like Hugo Boss and Burberry, which account for 69% of its sales. These brands are not part of the consumer beauty business under strategic review.
Coty announced the strategic review of its consumer beauty division on September 30, 2025. It said the review could lead to divestitures, spinoffs, or partnerships. Meanwhile, the company said it was committed to growing its prestige division through blockbuster launches as well as brand enhancements. The company also said that it was focused on strengthening its revenue and profit engine.
Amid the turnaround efforts, Coty recently refreshed its board. The company announced on March 18 that it had appointed five new independent directors. It said the new directors bring decades of industry expertise and leadership experience. Coty’s revenue rose 1% YoY to $1.68 billion in the December 2025 quarter.
Coty Inc (NYSE:COTY), headquartered in Amsterdam, Netherlands, is a multinational beauty company. It manufactures and sells skin care, hair care, nail care, fragrances, and cosmetic products. Coty was founded in 1904.
