I recently wrote several penny stock articles. investor place After discovering numerous overlooked investment opportunities. However, my past research has been deeply value-oriented, which led me to write another article on growth penny stocks.
In this article, we'll focus on growth-oriented penny stocks, specifically disruptive companies. By searching for stocks with unique risk slopes, I confirmed that the stocks I selected had a diversifying effect on my portfolio. Certainly, you should consider individual risks before taking advantage of penny stocks, but as mentioned above, adding penny stocks to an already diversified portfolio can increase returns while reducing risk. Masu.
Here are three disruptive penny stocks that penny stock proponents like me should consider.
Velo3D, Inc. (VLD)
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Vero 3D (New York Stock Exchange:VLD) is entering the 3D printing space and is expected to grow at a compound annual growth rate (CAGR) of 23.5% through 2030. However, Velo3D has a unique value proposition that further increases its industry-based growth rate. The company provides metal 3D printing solutions for developing parts used in space exploration. Velo3D's early-to-market approach is capital-intensive, but definitely promising.
I have to mention that Velo3D has faced some headwinds recently. The company acknowledged that its third-quarter net loss could fall to $17.4 million due to a soft corporate R&D spending environment. Additionally, there are questions about Velo3D's ability to meet its debt covenants, which has resulted in a decline in the value of its common stock.
Recent headwinds for Velo3D are temporary. In fact, I would even go so far as to say that they are just part of the journey of an innovative startup. Continued product quality improvements and a planned 40% reduction in operating expenses support the company's long-term prospects. On top of that, I think Velo3D will quickly become an acquisition target due to its unique services and deep internal intellectual capital.
VLD stock has lost more than 25% of its market value since the beginning of the year, with a price-to-sales ratio of just 0.47. Moreover, the company's revenue has increased by 71.92% over the past year, indicating its growth potential.
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Farmer Brothers Co., Ltd. (FARM)
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Farmer Brothers Company (NASDAQ:farm), also known as Farmer Brothers, is a coffee and coffee supplies distributor with adjoining business representation. The company's strength lies in rapid implementation. But another element of Farmer Brothers' growth story is the industry fragmentation within the coffee industry that has led to the creation of a broader range of brands. Farmer Bros. has the freedom and enthusiasm necessary to continue growing 33.04% year-over-year while delivering stellar returns to investors.
The big turnaround came last month after Farmer Brothers posted second-quarter earnings of 13 cents a share. In addition, Farmer Brothers saw strong demand, with sales increasing by $600,000 to $89.5 million, and the company's gross margin increased by 550 basis points to 40.4% due to lower commodity prices.
Farmer Brothers will benefit from sustainable long-term growth due to its strong end-market responsiveness. Additionally, further input cost relief will expand Farmer Brothers' profit margins and increase shareholder value.
Finally, FARM stock is well positioned from a market-based perspective. The stock has a price-to-sales ratio of just 0.21x, making it a positive value in absolute terms. Additionally, FARM stock is trading above its 50-day, 100-day, and 200-day moving averages, meaning a momentum trend is forming.
E3 Lithium Limited (EEMMF)
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If you're looking for an overlooked lithium exploration company, you've come to the right place.
E3 lithium's (OTCMKTS:EEMMF) The goal is to become a leading integrated lithium company by mining 16 million tonnes of measured and indicated lithium carbonate equivalent resources. The results of the company's geophysical report speak to the company's potential to establish itself as Canada's largest lithium producer. Therefore, it is possible to achieve best-in-class shareholder value.
The company is still in the prototype stage and is not making any money. However, the E3 Lithium project offers a promising case study. For example, E3 Lithium's flagship project Clearwater is scheduled to deliver 20,000 tonnes per year to achieve a pre-tax internal rate of return of 32%.
E3 Lithium doesn't have any specific valuation or growth metrics to speak of. However, Clearwater's estimated earnings before interest, tax, depreciation, and amortization (EBITDA) is $208.6 million. Therefore, considering E3 Lithium's enterprise value of $66.94 million, the napkin calculation yields an attractive EV/EBITDA ratio of 0.32x.
On the date of publication, Steve Booyens did not have (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer and are subject to InvestorPlace.com Publishing Guidelines..
