2 “Strong Buy” Penny stocks that could register gains of 100% (or more)
In a recent review of current market conditions, JPMorgan strategist Eduardo Lecubarri recaps his view that 2021 will see modest gains across equities in general – but outperform the small and mid-cap sector. Lecubarri believes that investors may find opportunities for a sharp rise among stocks in this class. Driving the overall gains in inventories, Lecubarri points to recent manufacturing PMI impressions, which have been at high levels for 15 years, and falling unemployment – both data points point to a solid foundation for economic recovery. With consumer confidence also rising and savings relatively strong, he sees a tailwind for small and mid caps as the year unfolds. A general uptrend in small-cap stocks should naturally prompt analysts and investors to look at “pennies,” stocks priced below $ 5 per share. While not a sure indicator, a low stock price usually goes hand in hand with a low market cap – but that also comes with the strong upside potential Lecubarri mentioned. However, before jumping straight into a penny investment, Wall Street pros advise looking at the big picture and considering other factors beyond just price. For some names that fall into this category, you really get what you pay for, offering little prospect of long-term growth thanks to weak fundamentals, recent headwinds, or even a large number of shares outstanding. With the risk in mind, we used the TipRanks database to find two compelling penny stocks, as determined by the pros on Wall Street. Each of them has achieved a “Strong Buy” consensus rating from the analyst community and brings massive growth prospects to the table. We are talking about an upside potential greater than 100%. Biolase Technology (BIOL) We will begin with Biolase Technology, a leading designer, producer and innovator in dental laser technology. Lasers provide a host of benefits to dentists and their patients, including less aerosol sprays and a smoother feel during procedures, and more comfortable healing afterwards. Biolase products are used in periodontal, endodontic, hygienic and implant procedures; the company markets online directly to dental offices. Biolase put a positive spin on its recent report on 4Q20 results. Even though revenue of $ 8.52 million was down 16% year-over-year, the sequential quarterly gain was impressive, at 31%. The company benefited from the resumption of work at dental clinics during the economic recovery of 2H20. Biolase reported two positive trends in its fourth quarter sales, with 78% of sales coming from new customers and 40% going to dental specialists. Better yet, the company provided first-quarter revenue guidance of $ 7.5 million to $ 8.0 million, up 60-70% year-on-year, and above the consensus of $ 7.0 million. dollars. Currently at $ 0.76 a piece, Biolase shares could post big gains, some analysts say. Among the bulls is Maxim analyst Anthony Vendetti who noted that the company’s good points in the fourth quarter are not just spin. “As the international market continues to lag the United States in terms of the COVID recovery, BIOL achieved its second consecutive quarter of significant sequential revenue growth, driven by US sales to new customers, dental specialists and dental service organizations (DSOs). Specialists accounted for 40% of the company’s laser sales in the US in 4Q20 and expect the company’s recent launch of the Endo and Perio academies to help increase adoption by ~ 5K endodontists and ~ 5K periodontists. in the USA. increased focus on converting small DSOs (which can adopt BIOL’s technology faster), which we believe should bolster near-term revenue as the company moves forward in converting large DSOs, such as Heartland Dental (private), ”said the 5-star analyst. Vendetti summarized: “Based on BIOL’s unique product value proposition, its continued advancements in DSO penetration, and its growing traction with dental specialists, we reiterate our buy note.” Along with that buy note, the analyst sets a price target of $ 2 that points to 165% stock growth coming in 2021. (To look at Vendetti’s track record, click here) It looks like the rest of the street also sees a lot of benefits. only – 4, in fact – the analyst community rates BIOL as a strong buy. The average price target is $ 1.94 and implies a potential rise of ~ 157% over the next few months. (See BIOL stock market analysis on TipRanks) Fortress Biotech (FBIO) Fortress Bio is a pharmacology research company with a large portfolio of 28 drug candidates, at various stages of development, from preclinical trials to phase 3. In addition to the pipeline Fortress has six drugs approved on the market for a variety of skin conditions, including acne, fungal skin infections, burns, and other surface wounds. These drugs are marketed by Journey Medical, Fortress’s partner company, and generated sales of $ 44.5 million in 2020. n offset in 2019. Fortress ended 2020 with a strong cash position , holding $ 235 million in cash and cash equivalents. This is an increase of $ 15 million from the third quarter and 53% year over year. The company noted that these positive results came even as the COVID pandemic was impacting both supply and sales. Going forward, Fortress plans to add two new approved prescription products to its line in 2021. In another program update, Fortress is partnering with Cyprium Therapeutics and Sentynl Therapeutics on CUTX-101. The two companies have signed an asset development and purchase agreement for the drug candidate, a treatment for Menkes disease currently in phase 3 clinical trials. The company reported positive clinical efficacy results last August, including medial survival in the 14.8-year-old early treatment cohort, compared to 1.3 years in the untreated historical control cohort. In 2:21, Fortress will begin continuous NDA submission for CUTX-101. Covering this title for B. Riley, 5-star analyst Mayank Mamtani notes the fundamental strength of the company. “FBIO’s differentiated business model, constituting a diversified portfolio of marketed products and clinical stage candidates, remains resilient in the face of the challenges posed by the C-19 pandemic, thus establishing itself favorably upstream of the many regulatory inflection points. , clinics and anticipated balance sheets for the following quarters provided an opportunity to reassess the title, ”Mamtani wrote. To that end, Mamtani is pricing FBIO a buy, and his price target of $ 10 suggests there is room for a hike of around 100% over the next 12 months. (To view Mamtani’s track record, click here) Overall, Fortress Bio has 4 registered reviews, and all of them are buyable, giving the stock a Strong Buy consensus rating. FBIO shares are priced at $ 4.48 and their average price target of $ 13 implies a one-year rise of 190%. (See FBIO Stock Market Analysis on TipRanks) For great ideas for trading penny stocks at attractive valuations, visit TipRanks Best Stocks to Buy, a newly launched tool that brings together all the information about TipRanks stocks . Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.