I think that investors of all risk tolerances and time horizons should consider adding at least a tiny proportion of their portfolios of top penny stocks to buy.
These companies may give your portfolio that extra juice or flavor to boost returns, especially in the bull market that we’ve been seeing today. While in the bear market, the stability of one’s blue chips or broad-market ETFs can absorb the impact of losses.
Still, it’s crucial to select the right companies, even if you are only allocating a few hundred dollars toward them. I think one key is to reduce speculation as much as possible and instead rely on facts and a forward-looking, well-reasoned analysis when making investment choices.
So here are three top penny stocks for investors to consider as we start March off with a bang.
Grab Holdings (GRAB)
Grab Holdings (NASDAQ:GRAB) operates a super app in Southeast Asia, providing services across mobility, deliveries, and financial services. SEA is a hotbed for growth, with countless people rising out of poverty and lower incomes into the middle class. Entrepreneurship and the gig economy are central to this growth movement, and GRAB is at the forefront.
Aside from this long-term growth outlook, analysts expect GRAB’s revenue growth to slow down compared to its historical rate but still outpace the broader industry, forecasting a 21% annualized growth rate through the end of 2024 compared to its past three-year growth rate of 54%.
This is built on the back of its great previous quarter in Q4 2023. The company reported a profit of $11 million for the quarter, contrasting with a net loss of $391 million in the same period the previous year. This turnaround was attributed to better Group Adjusted EBITDA. Group Adjusted EBITDA for the quarter was $35 million, a remarkable improvement from the negative $111 million recorded for the same period in 2022.
The future also looks accretive for the company. It has set an FY2024 revenue guidance at $2.7 billion to $2.75 billion, projecting a year-over-year growth of 14% to 17%. Adjusted EBITDA is expected to be between $180 million and $200 million.
Taboola (TBLA)
Taboola (NASDAQ:TBLA) specializes in digital advertising, offering a platform that provides recommendations for the open web.
I like TBLA on several fronts, and some other analysts agree. The company recently maintained guidance for $200 million in adjusted EBITDA and $100 million in free cash flow. A bear scenario analysis suggests a possibility of TBLA achieving only a 3% growth in FY2024.
Even if TBLA were only to reach 3% growth for this financial year, I still think that’s a great result, especially since we’re seeing some cyclical headwinds in the online advertising space that could be unduly keeping its valuation down.
Other factors that give TBLA a big upside include its market cap of just $1.28 billion. And despite a negative EPS of $0.24 and a net income of -$11.98 million, the forward P/E ratio of 22 times earnings means analysts are pricing in a big positive change in its fundamentals.
Trading at just 0.9 times sales, TBLA’s prospects look attractive, and its valuation is very cheap. The product also seems to be validated and is working in its early stages, which is perhaps one of the hardest nuts to crack in its industry. For these factors and more, I think TBLA is one of those top penny stocks for investors.
Opendoor Technologies (OPEN)
Opendoor Technologies (NASDAQ:OPEN) is a real estate company that provides a digital platform for buying and selling homes.
The real estate market for top penny stocks is a slightly underappreciated industry. Breaking into the industry is tough, with many entrenched competitors. However, based on its recent financial results, I think OPEN has the potential to become a multi-bagger.
The balance sheet at the end of the third quarter showed $1 billion in total shareholders’ equity, with $1.5 billion in total capital. Revenue for next year should leap an incredible 57.58% to $9.7 billion, per analyst estimates. The predicted upside then is huge, and I think that its stock price doesn’t fully capture its valuation.
For investors looking to invest in a tech stock that serves the real estate industry, OPEN is definitely one of those top penny stocks to consider.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.