Despite 18 months of rising interest rates from the Fed, the U.S. economy held a steady 4.9% growth rate in Q3, defying the gloomier economic predictions from economists and analysts. This robust growth was driven by consumer spending, a healthy labor market and a sense of financial security among consumers. Concerns about a U.S. GDP slowdown aside, the economy appears to have grown past the possibility of a recession. Additionally, this positive economic outlook provides a favorable environment for penny stocks growth. As the economy and consumer confidence maintain their momentum, investors will find vast opportunities in these three penny stocks.
Ardelyx (ARDX)
Ardelyx (NASDAQ:ARDX) is a biotechnology company that creates medicines for currently unmet medical needs.
ARDX stock is up 34.33% YTD. Analysts rate the stock from a “buy” to a “strong buy”, with a price target of $9.81. As of the last year, Ardelyx has seen a sales growth rate of 416.57% up to $52,158. Ardelyx has demonstrated a focus on upgrading its assets, with a capital expenditures growth rate of 97.05% last year. The company has also shown healthy growth with an EPS growth rate of 72.10% in 2022.
Currently, Ardelyx offers two products. IBSRELA treats IBS-C and XPHOZAH for chronic kidney disease. The company shows no signs of stopping, with two upcoming first-in-class treatments and a compound named RDX013. Due to its innovative and essential treatments for common diseases, Ardelyx is a strong stock for investors interested in biotech and penny stocks.
Kinross Gold (KGC)
Kinross Gold (NYSE:KGC) is a strong contender in the gold mining industry. Its priorities include a commitment to safety, responsible mining, financial discipline and a high-performance culture.
In Q2 2023, the company saw revenue of $15.9 billion grew 24.12% YoY. Net income and diluted EPS of $1.06 billion and $1.34 grew 55.42% and 54.02% YoY, respectively. Kinross Gold is on a growth trajectory fueled by its strategic emphasis on boosting gold production through planned mine life extensions and capital reinvestment facilitated projects. This trajectory creates a low-risk and timely platform for growth in the current favorable gold price environment.
The recent development of BRICS positions the company as a formidable player in the gold mining industry. BRICS’ expansion to include Saudi Arabia and other nations creates a powerful anti-western alliance. This alliance fosters an environment that could potentially challenge the dominance of the U.S. dollar. The geopolitical shift and focus on a common currency backed by commodities may lead to a revaluation of gold. A revaluation could have a substantial positive impact on KGC stock, given its focus on production growth and cost management.
KGC is well-positioned for significant success in the foreseeable future. With a resounding ‘Buy’ recommendation from 10 Yahoo! Finance analysts, KGC is primed for expansion.
SoundHound AI (SOUN)
SoundHound AI (NASDAQ:SOUN) is an audio and speech recognition company that pioneers services in natural language understanding.
The company has healthy financials, including a Q3 revenue of $8.7 million that grew 42.25% YoY. Additionally, the company saw a net income of -$21.93 million, which grew 28.49%. It also saw a net change in cash of $82.98 million, which increased by 48.01% YoY. Lastly, SoundHound shows strong indicators of profitability as its operating income of -$16.27 million increased by 42.76% YoY. These financials indicate that the company will be steadily creating profit and revenue in the years to come
SoundHound has established long term partnerships for long term growth. The company recently secured $100 million in strategic financing from Atlas Credit Partners. The additional capital will support innovation, market expansion and the growth of its subscription and licensing businesses. After closing costs and repayment of existing debt, the company is expected to have a cash balance of over $100 million, with the option to access an additional $25 million.
Yahoo! Finance reports 5 analysts predicting a 1-year price range for SOUN stock to have a low to high price range of $4.00 to $7.00, with an average of $5.04 from its current price of $1.56. SoundHound stock is undervalued and the company will only prove to maintain its global lead in the voice AI industry. Investors should buy in for long-term returns.
On the date of publication, Michael Que did not have (either 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.
The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.