Stocks to buy

3 Penny Stocks to Make You the Millionaire Next Door

When it comes to investing, penny stocks often evoke a sense of intrigue and opportunity. These low-priced securities, typically traded under $5 per share, can potentially deliver substantial gains quickly. If you want to dive into the world of penny stocks, we have curated a list of three promising options. This article will explore the top penny stocks to buy, aiming to provide key insights to make informed decisions.

Penny stocks are notorious for their volatility, offering both significant risk and the potential for extraordinary rewards. These stocks often represent small, emerging companies in niche industries poised for growth. However, it’s crucial to approach penny stocks cautiously, as their low share prices make them susceptible to sudden price swings.

While they can provide tremendous opportunities for profit, diligent research and a well-defined strategy are essential to successfully navigate this high-risk, high-reward game.

Identifying promising penny stocks to buy requires a keen eye for opportunity and understanding of market trends. Our expert analysis has led us to three penny stocks that show remarkable potential. These stocks possess compelling business models, innovative products or services, and favorable market conditions that could catapult their valuations in the near future.

By investing in these carefully selected penny stocks, you could position yourself to reap substantial financial rewards and potentially join the ranks of the next-door millionaire.

ATAI  ATAI Life Sciences $1.80
SRNEQ Sorrento Therapeutics $0.30
RIGL Rigel Pharmaceuticals $1.33

ATAI Life Sciences (ATAI)

Source: Dmitry Kalinovsky / Shutterstock.com

ATAI Life Sciences (NASDAQ:ATAI) is a renowned global biopharmaceutical company specializing in developing innovative treatments for mental health disorders. The company has recently garnered significant attention in the stock market, particularly due to the positive impact of H.C. Wainwright & Co.’s endorsement. This influential firm issued a $20 share price target for ATAI, propelling its stock value to surge.

As of May 24, 2023, ATAI Life Sciences boasts an average one-year price target of $13.75, as predicted by industry analysts. These forecasts range from $9 to $20, indicating a considerable increase compared to its previous closing price of $1.88. Over the past 12 months, ATAI’s stock has witnessed a remarkable growth rate of 631.38%.

Despite its impressive performance in the stock market, ATAI has faced its fair share of challenges since its public debut in mid-2021. As a clinical-stage biopharmaceutical company, ATAI primarily provides financial support to its subsidiaries engaged in developing psychedelic treatments.

However, the company has encountered setbacks in clinical trials for certain products, such as KUR-101, which aims to address opioid use disorder, and PCN-101 (R-ketamine), designed to target treatment-resistant depression. These unfavorable outcomes have contributed to a decline in investor interest.

ATAI Life Sciences recognizes the importance of overcoming these challenges and striving for breakthroughs in their product development pipeline. While the journey may have been rocky thus far, the company remains committed to pushing the boundaries of innovation in mental health treatments.

While facing hurdles in clinical trials, ATAI remains determined to advance mental health disorder treatments and positively impact the biopharmaceutical industry.

Sorrento Therapeutics (SRNEQ)

Source: ra2 studio/Shutterstock

Sorrento Therapeutics (OTCMKTS:SRNEQ) stock has seen a huge decline of 76.90% over the past 12 months. It gained steam during the pandemic because its products became popular. However, demand is now weakening. As a result, investors are losing interest.

Amidst the COVID-19 pandemic, Sorrento made significant strides in developing diagnostics and therapies for the virus. However, as the pandemic gradually recedes, the commercial prospects associated with these products have diminished. Despite this, Wall Street remains optimistic about Sorrento’s future. In November, Cantor Fitzgerald, a financial services firm, provided a price target of $5 for Sorrento’s stock. This target represents a significant increase from its closing price of 34 cents on May 23.

The basis for this optimism extends beyond the realm of COVID-19. Sorrento boasts a diverse lineup of clinical candidates addressing pain, cancer, and autoimmune disorders. Bulls, or optimistic investors, believe that the true value of this pipeline is currently under-appreciated in the market.

Could Sorrento’s stock stage a comeback soon? The biopharmaceutical company’s shares have already gained 11% since the beginning of the year, indicating positive momentum. This is an encouraging sign that value-oriented investors may be starting to show interest in the stock.

A positive pipeline update could accelerate the trajectory of the stock’s recovery. However, it is important to note that there is no guarantee that Sorrento will have favorable news to share with investors in the near future.

Rigel Pharmaceuticals (RIGL)

Rigel Pharmaceuticals (NASDAQ:RIGL), a commercial-stage biopharmaceutical company, has been gaining attention and experiencing positive momentum in the market recently. Since the beginning of the year, the company’s shares have seen a healthy increase of 23%.

Rigel’s stock has caught the eye of Wall Street for several reasons. Firstly, the company achieved a significant regulatory victory last month with the FDA approval of Rezlidhia. This drug is indicated for adults with relapsed/refractory acute myeloid leukemia with a susceptible isocitrate dehydrogenase-1 mutation. While facing competition from Servier’s Tibsovo, Rezlidhia’s superior profile positions it as a potential leader in the market.

Secondly, Rigel’s first commercial-stage drug, Tavalisse, designed for treating chronic immune thrombocytopenia, has performed exceptionally well in the marketplace. Rezlidhia and Tavalisse’s combined success can potentially drive Rigel toward reaching a break-even point from a cash-flow perspective.

Furthermore, Rigel has multiple upcoming clinical catalysts that could propel its shares to skyrocket in the next 24 months. The average analyst estimate suggests that this small-cap biotech stock could appreciate by an impressive 369.72% over the next 12 months. This indicates strong confidence in Rigel’s prospects among industry experts.

Rigel Pharmaceuticals’ recent achievements, promising product portfolio, and anticipated clinical developments have generated considerable excitement and positive expectations, positioning the company for potential growth in the coming months.

Still working on your investment portfolio? No need to worry! We’ve got you covered with an excellent selection of growth stocks that are definitely worth considering. Enjoy your investing journey!

On the publication date, Faizan Farooque did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. His passion is to help the average investor make more informed decisions regarding their portfolio.

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