3 Undervalued Penny Stocks According To Analysts

If you’re looking for penny stocks to buy this week, you have a lot to contend with. Whether it’s CPI, the latest FOMC meeting, or Jerome Powell’s hawkish comments, volatility is everywhere as a result. But for those trading cheap stocks, this type of trend is known all too well.

Taking everything else out of the equation, lower prices lend themselves to higher chances for considerable swings in the stock market. A 40-cent stock can move a few pennies and experience a significant percentage change in value. That means stocks can jump or fall in meaningful amounts within minutes at times.

This extreme volatility – the moves that happen in minutes – doesn’t happen to all penny stocks. So if you’re not used to high volatility or high-frequency trading, don’t worry. There are other cheap stocks to watch, and some have even attracted the attention of analysts.

Penny Stocks & Analysts

Wall Street analysts are professionals researching and analyzing publicly traded companies and providing recommendations to investors. Their advice can influence sentiment for individual and institutional investors.

There are several reasons why analyst recommendations may matter:

1. Expertise: Wall Street analysts are presumed to be experts in their field. They are trained to analyze financial statements, industry trends, and other factors impacting a company’s performance. Their recommendations are based on research and analysis and can provide insights to investors.
2. Influence: Wall Street analysts work for financial institutions and are often cited in the media.
3. Confidence: If many analysts are bullish or bearish on a stock, it may influence investor confidence or insecurity in a stock.

It’s important to note that analyst recommendations should be just one factor in an investor’s decision-making process. Furthermore, just because there is a buy rating or sell rating, that doesn’t mean it’s a guarantee that is the correct course of action to take. It’s always a good idea to do your research and due diligence to arrive at a decision that aligns with your goals as a trader.

Amyris, Inc. (NASDAQ: AMRS)

The synthetic biotech company Amyris, Inc. has been in a sideways trend over the last few weeks. At the end of the week, however, AMRS stock popped. There wasn’t any immediate news or SEC filing connected with the jump. However, shares managed to jump nearly 10% on higher volume than its prior session.

Amyris recently provided earnings results showing Q3 revenue growth of 49% compared to last year’s quarter. The increase was attributed to record consumer revenue of $46.6 million. CEO John Melo also commented in Amyris’ third-quarter update that “Amyris outperformed key players in the beauty space according to the NielsenIQ 12 weeks trailing year-over-year growth rate of 7%…We have built the leading Lab-to-Market(TM) technology platform for synthetic biology and bio-manufacturing. After an extended period of rapid organic growth and acquisition activity, we are increasingly focused on brand integration, cash conversion efficiency, and cost optimization to achieve our profitability goals.”

Something else that has caught some attention is the AMRS stock short float. Short-squeeze penny stocks have been a hot topic over the last few weeks. As of this article, TDAmeritrade shows the Amyris short float percentage sitting around 19%. Recent analyst ratings may also suggest a more mixed outlook, but some are more bullish than others. HC Wainwright has AMRS at a Buy with a $30 target. Other analysts like Roth Capital and Piper Sandler have less bullish ratings (Neutral). But both have set targets higher than current trading levels ranging from $2 to $4.

thredUP (NASDAQ: TDUP)

ThredUp is another one of the penny stocks that saw a more robust uptick in trading this week. The company specializes in online resale platforms for women’s and kids’ apparel, shoes, and accessories. It recently engaged in a resale program with Torrid Holdings (NYSE: CURV), which will use thredUP’s Resale-as-a-service. Torrid will implement the RaaS platform in its Clean Out program.

“As the first plus-sized brand to leverage our RaaS platform, Torrid is a leader in its industry and making secondhand available to even more customers,” said James Reinhart, CEO of thredUP. “Torrid’s resale program offers a tailored and unique experience that provides consumers with a responsible way to give their preloved clothing a second or even third life.”

This move comes just a week after thredUP secured a partnership with AZEK (NYSE: AZEK) for plastic recycling. AZEK will collect thredUP’s polyethylene plastic Clean Out Bags after the items inside of them have been processed.

While there haven’t been any further updates on Friday, shares of TDUP stock have climbed higher. It might not come as a shock, then, that some analysts are bullish on TDUP right now. Raymond James, for instance, currently has an Outperform rating on the penny stock. It also set a price target at $4.

Sangamo Therapeutics (NASDAQ: SGMO)

Despite being a bit more beaten up this year than others on this list of penny stocks, Sangamo has the attention of a few Wall Street analysts. Most recently, Wells Fargo adjusted its price target to $20. It also has an Overweight rating on SGMO stock.

The company recently reported Q3 results and business highlights showing progress in its pipeline. Sandy Macrae, Chief Executive Officer of Sangamo, also gave some action items for the market to pay attention to in the near term.

“We were proud to present promising updated preliminary data from our wholly owned Fabry study, to resume our partnered Hemophilia A pivotal trial, and to continue dosing in our renal transplant rejection and sickle cell studies. Our pipeline progress is expected to yield additional data in Q4 and into 2023.”

With this backdrop, it will be interesting to see if the company can execute this goal of additional data during Q4 in particular. So far, no new updates have come out from the company since its Q3 update.

Penny Stocks. ToBuy According To Analysts

1. Amyris, Inc. (NASDAQ: AMRS)
2. thredUP (NASDAQ: TDUP)
3. Sangamo Therapeutics (NASDAQ: SGMO)

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