If there’s one strategy growing in popularity right now, it’s “follow” the money. Whether you’re looking for penny stocks to buy or which stocks to invest in, “smart money” is a focus for many. Most companies won’t come out to state who their big investors are. But if you know where to look, you can follow the money yourself. Today we look at a handful of penny stocks that some of Wall Street’s top investors own, believe it or not. We aren’t talking about no-name upstart individuals or hedge funds either. Ray Dalio, David Einhorn, Peter Lynch, & Steven Cohen grace this list of penny stocks today.
Penny Stocks To Watch
- IMAC Holdings (NASDAQ: IMAC)
- 23andMe Holding Co. (NASDAQ: ME)
- Mereo Biopharma Group (NASDAQ: MREO)
- Clean Energy Fuels Corporation (NASDAQ: CLNE)
- HUYA Inc. (NYSE: HUYA)
Finding The Best Penny Stocks To Buy
Finding the best penny stocks to buy is easier said than done. But, in most cases, a list is a great place to start. Identifying the trends, you’re looking for or searching for pockets of momentum are a few of the ways traders find opportunities in the stock market today. In this article, we look at a handful of penny stocks to watch that are also on the lists of some of Wall Street’s top investors.
Peter Lynch Takes Stake In IMAC Holdings (NASDAQ: IMAC)
If you’ve never heard of IMAC Holdings, that might change soon. That’s because a filing popped up this week showing legendary investor, Peter Lynch taking a stake in the company. The 13G filing shows Lynch owning a 5.23% stake in the company. The former Fidelity Magellan fund manager has made it a point to avoid owning more than a 5% stake in companies. Apparently, according to an interview, he didn’t realize this was the case. Regardless, his stake has caused a stir in the retail arena as shares of IMAC stock surged this week.
The filing comes just days after IMAC reported earnings for its first quarter of the year. The company develops regenerative rehabilitation orthopedic treatments and recorded increased revenue for the fourth-consecutive quarter, with total revenue coming in at $3.9 million.
“The first quarter of 2022 demonstrated IMAC’s ability to deliver on significant commitments. For example, we started the quarter by successfully retiring debt obligations to a lending partner that helped us through challenging market conditions in 2020. Then, we finished the quarter by meeting obligations of our 10 store pilot program with Walmart, setting up substantial growth prospects for our company,” said Jeffrey Ervin, CEO of IMAC.
With Lynch on the investor roster, IMAC stock could be one of the names to watch this week.
David Einhorn’s Greenlight Capital Reveals Holding In Penny Stock 23andMe Holding Co. (NASDAQ: ME)
Other than 13G filings, the latest round of 13F’s is coming out. These filings show the quarterly holdings at the end of Q1 for money managers. They’ve been used to find out Warren Buffett’s top holdings. These filings have also been used to identify “smart money” flow from other top investors. David Einhorn’s Greenlight Capital seems to have given the green light for penny stocks.
Specifically, Greenlight’s latest 13F shows the firm has a stake in genetics and research company 23andMe Holding Co. Einhorn reported a 73,591 share position. This figure was lower than what was filed for Q4, 2021 holdings and may be something to keep in mind if you’re whale hunting right now.
23andMe is known for its self-serve genetic testing kits. But it has expanded its offering beyond any genealogy product. The company recently closed the acquisition of Lemonaid Health Inc. for $400 million. They are an on-demand platform for accessing medical care and pharmacy services online. Next week ME stock could be a focus as the company is set to release its next round of earnings on Thursday.
In its FY 2022 Q3 results posted earlier this year, the company gave updated guidance and expectations: The projected range for full-year revenue for fiscal 2022, which will end on March 31, 2022, has been increased from $250 to $260 million to $268 to $278 million. The increase in projected revenue is primarily due to the addition of telehealth services to 23andMe’s consumer business.
We’ll see what comes next week in its official results.
Point72’s Steve Cohen Not Shy Of These Penny Stocks: Mereo Biopharma Group (NASDAQ: MREO) & Clean Energy Fuels Corporation (NASDAQ: CLNE)
Steven Cohen has become somewhat of a favorite among small & micro-cap traders. It has been more frequent than not to see excitement stem from a Point72 filing in penny stocks. Cohen’s latest 13F filings show positions in several. Mereo Biopharma Group and Clean Energy Fuels are just a few on the list of penny stocks.
Mereo Biopharma Group
Shares of MREO stock have climbed for the better part of the last few weeks. This comes as a reprieve from what has been a constant sell-off in the penny stock. For the last few quarters, Point72 has reported increased stakes in MREO stock. For the period ended September 30th, Point72 reported 9,975,000 shares. The following quarter, that figure jumped to 10,610,000. The latest details show Point72 has 11,495,000, albeit at half the dollar value the position was back in September.
Earlier this month, the company announced top-line efficacy and safety data from its “ASTRAEUS” Phase 2 study. Mereo’s alvelestat (MPH-966) was studied in patients with severe alpha-1 antitrypsin deficiency-associated emphysema. Dr. Denise Scots-Knight, Chief Executive Officer of Mereo, explained, “Alvelestat has the potential to be the first-in-class oral neutrophil elastase inhibitor for the treatment of AATD-LD. We look forward to analyzing the additional data on the secondary and exploratory endpoints and to engaging with the regulators on the design of a pivotal study.”
Clean Energy Fuels Corporation
Energy stocks have become a favorite of retail traders and investors in the stock market this year. It would appear that over the last year, Point72 has increased its position by 1,200%. The previous report in 2021 showed the firm owning around 75,000 shares of CLNE stock. The latest 13F filing shows a position of over 900,000 shares held at the end of the first quarter.
Recent earnings from the company didn’t bode well for the stock, coincidentally, since the end of Q1. Clean Energy missed earnings per share and sales estimates. Despite the miss, the company was able to see revenue growth of 8.2% compared to the first quarter of last year. Analysts at Raymond James and Credit Suisse kept their bullish outlook and have Outperform ratings on the penny stock. Meanwhile, price targets range from $6 to $12.50.
Ray Dalio’s Bridgewater Associates Shows Continued Stake In HUYA Inc. (NYSE: HUYA)
Game live streaming company HUYA Inc. has followed the overall trend of esports and entertainment stocks over the last year. HUYA stock has dropped from over $18 to under $5. But that doesn’t seem to have scared away big investors. The latest 13F filing from Ray Dalio’s Bridgewater Associates shows HUYA still has a place on the list of penny stocks to watch. While this quarter’s position is lower than the last, it remains larger in share volume than in all other quarters.
China’s streaming crackdown put a dent in HUYA’s latest round of earnings. Additionally, new COVID restrictions have also impacted the stock’s performance. Ashley Xin Wu, Vice President of Finance of Huya, mentioned that “Given the continued macro headwinds and the recent resurgence of the COVID-19 pandemic in China, we achieved RMB2,464.6 million total net revenues and RMB333.6 million gross profit in the first quarter of 2022. We remain confident that by fostering quality content, driving product innovation, running efficient operations, and enhancing our compliance capabilities, we will strengthen Huya’s core competitiveness in the game live streaming industry.”
HUYA stock has managed to rebound over the last week.
Penny Stocks To Watch
When putting together your list of penny stocks to watch, understanding market trends helps. It’s also worth knowing who’s buying or selling. Today we looked at a few penny stocks to watch based on recent activity from some of Wall Street’s top investors. Will they join your watch list soon, or are they to be avoided at all costs? Leave a comment and let us know what you think.