Hedge Funds Say These 5 Penny Stocks are Poised to Explode

Below you can find the list of 5 penny stocks that are poised to explode according to hedge funds. For a discussion of penny stock investing and a more comprehensive list please see Hedge Funds Say These 10 Penny Stocks Are Poised to Explode.

5. Globalstar, Inc. (NYSE:GSAT)

Share Price as of December 15: $1.66
Stock Price Upside Potential: 178%
Number of Hedge Fund Holders: 20

Globalstar, Inc. (NYSE:GSAT) is a communication services penny stock that offers mobile satellite service. Globalstar, Inc. (NYSE:GSAT) makes and sells products for two-way voice and data communication via satellite. These products are used for remote work and leisure activities.

According to Anson Funds portfolio manager Sagar Gupta, Globalstar, Inc. (NYSE:GSAT) could be a seven-bagger satellite communication company thanks to its relationship with Apple and lots of spectrum that can be monetized.

While Globalstar, Inc. (NYSE:GSAT) has gained 17% year to date, consensus estimates on Wall Street indicate the stock is a strong Buy with a $4.4 price target implying 178% upside potential. Out of 910 hedge funds in Insider Monkey’s database, 20 invested in Globalstar, Inc. (NYSE:GSAT) by Q3 2023, holding shares worth $82.74 million.

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4. Heron Therapeutics Inc. (NASDAQ:HRTX)

Share Price as of December 15: $1.74
Stock Price Upside Potential: 184%
Number of Hedge Fund Holders: 18

Headquartered in San Diego, California, Heron Therapeutics Inc. (NASDAQ:HTRX) is a biotechnology company that develops treatments to address unmet medical needs. Heron Therapeutics Inc. (NASDAQ:HTRX)’s lead products use its proprietary Biochronomer, a drug-delivery technology that delivers therapeutic levels of short-acting pharmacological agents. 

In the third quarter, Heron Therapeutics Inc. (NASDAQ:HTRX) delivered revenues of $31.43, representing an 18.4% year-over-year increase. It is one of the penny stocks hedge funds say is poised to explode as it is already up by 40% for the year. Analysts have a Buy rating on Heron Therapeutics Inc. (NASDAQ:HTRX) with a $5.17 price target, implying 184.07% upside potential from current levels.

A total of 18 hedge funds out of the 910 hedge funds tracked by Insider Monkey reported having stakes in Heron, down from 22 in the previous quarter.

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3. Lyra Therapeutics, Inc. (NASDAQ:LYRA)

Share Price as of December 15: $4.24
Stock Price Upside Potential: 235%
Number of Hedge Fund Holders: 14

Based in Watertown, Massachusetts, Lyra Therapeutics, Inc. (NASDAQ:LYRA) is a clinical-stage biotechnology company that develops and commercializes novel integrated drug and delivery solutions for the localized treatment of ear, nose, and throat diseases. Lyra Therapeutics, Inc. (NASDAQ:LYRA)’s Xtrei technology platform helps in delivering medications to the affected tissues.

In Q3, Lyra Therapeutics, Inc. (NASDAQ:LYRA) announced positive top-line data for the BEACON phase II study of LYR-220 in CRS patients with prior sinus surgery. The treatment showed clear and meaningful reductions in symptom severity, meeting the primary safety goal of the trial.

Lyra Therapeutics, Inc. (NASDAQ:LYRA) is one of the penny stocks on the move that’s well poised to explode, going by the 28% gain year to date, outperforming the S&P 500. In addition, analysts on Wall Street are bullish about its long-term prospects, with a Buy rating and $13.50 price target implying a 235% upside potential.

Lyra Therapeutics, Inc. (NASDAQ:LYRA) was in 14 hedge fund portfolios at the end of the third quarter of 2023.

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2. Black Diamond Therapeutics, Inc. (NASDAQ:BDTX)

Share Price as of December 15: $2.58
Stock Price Upside Potential: 290%
Number of Hedge Fund Holders: 17

Black Diamond Therapeutics, Inc. (NASDAQ:BDTX) is another clinical-stage company for anyone eyeing exposure to discovering and developing therapies for genetically defined cancers. BDTX-1535, the lead product of Black Diamond Therapeutics, Inc. (NASDAQ:BDTX), is an EGFR MasterKey inhibitor that can enter the brain, target specific mutations, and permanently block a group of cancer-causing changes.

Black Diamond Therapeutics, Inc. (NASDAQ:BDTX) delivered a loss of $23 million in Q3, or 45 cents a share, beating the consensus estimate of 49 cents a share. The penny stock is again moving, going by the 50% gain year to date. Analysts on Wall Street expect the impressive rally to persist in 2024, going by a Buy rating and a $10.67 price target, implying 290% upside potential.

As of the end of the third quarter of 2023, 17 hedge funds tracked by Insider Monkey had stakes in Black Diamond Therapeutics, Inc. (NASDAQ:BDTX). The leading stakeholder of Black Diamond Therapeutics, Inc. (NASDAQ:BDTX) during this period was Peter Kolchinsky’s RA Capital Management, with a stake worth about $10.12 million.

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1. Taysha Gene Therapies, Inc. (NASDAQ:TSHA)

Share Price as of December 15: $1.64
Stock Price Upside Potential: 291%
Number of Hedge Fund Holders: 16

Taysha Gene Therapies, Inc. (NASDAQ:TSHA) is a penny-stock healthcare company that develops and commercializes adeno-associated virus-based gene therapies for treating central nervous system monogenic diseases. Taysha Gene Therapies, Inc. (NASDAQ:TSHA)’s lead product is TSHA-120, used for treating giant axonal neuropathy, and TSHA-102, used for treating Rett syndrome.

Despite going down 1% for the year, Taysha Gene Therapies, Inc. (NASDAQ:TSHA) is one of the penny stocks hedge funds expect to explode. The consensus estimate on Wall Street is a Strong Buy with a $6.07 price target, implying 291% upside potential.

At the end of Q3 2023, 16 hedge funds held stakes in Taysha Gene Therapies, Inc. (NASDAQ:TSHA). The total value of these stakes amounted to $145.38 million. This is compared to 8 positions in the previous quarter with stakes worth $3.34 million. 

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