June may not be the first month you consider when you plan to invest, but this isn’t a month that should be overlooked. June is an ideal time to look for A-rated penny stocks to diversify your portfolio and lead to some potentially lucrative returns.
Penny stocks are shares of companies with stock valued under $5. It’s appealing to investors since they can acquire a significant stake in a company with a small investment.
However, not all penny stocks are created equal, and the risks associated with them can be substantial. This is where A-rated penny stocks come into play.
A-rated penny stocks get their rankings from the Portfolio Grader, which assigns stocks a letter grade based on earnings performance, growth, analyst sentiment and buying momentum. By keeping your eye on A-rated penny stocks, you’re assured of getting the best of these low-priced stocks and setting yourself up for a better overall return.
And with June being a popular month for companies to file earnings reports, investors are armed with new information about these companies’ performance and outlook.
There are seven A-rated penny stocks on today’s list, and any of them would be a solid addition to a portfolio while mitigating the risks that are commonly associated with smaller companies.
Lexaria Bioscience (LEXX)
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Biotech companies can be challenging investments. Bringing a drug to market is no small feat, as it requires millions of dollars in research and development and multiple successful clinical trials before you can even consider seeking regulatory approval and achieve commercialization.
But Lexaria Bioscience (NASDAQ:LEXX) is an exception to the rule. The company is the creator of DehydraTECH, which is a drug delivery technology that improves the way active drugs enter the bloodstream.
DehydraTECH increases the absorption of the drug into a patient and helps the medication take effect faster. It also reduces the need for sugar-filled tablets, capsules and oral suspensions because it can mask the taste of medications.
Biotechs can incorporate the DehydraTECH platform into any of their oral medications to make them more effective and tolerable for patients.
Any drug delivery system that makes medications more effective and more tolerable to patients is going to be popular in the biotech field.
The DehydraTECH platform increases the absorption of the drug into a patient and helps the medication take effect faster. It also reduces the need for sugar-filled products because it can mask the taste of medications.
At the end of the second quarter, Lexaria was in a strong cash position, with $4.7 million on hand. Revenue in the quarter was only $145,000, but that is better than the $20,000 the company received in the second fiscal quarter of 2023. The company reported a loss of $668,000, but its losses are significantly dropping as the company edges toward profitability.
LEXX stock is up 130% this year and gets an “A” rating in the Portfolio Grader.
JanOne (JAN)
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JanOne (NASDAQ:JAN) is yet another bioscience company. It is developing nonaddictive treatments for conditions that cause severe pain. Its work is dedicated to helping people manage their pain without getting hooked on a treatment and developing a dependency for a drug, such as opioids.
Its most promising drug in the pipeline is a treatment for peripheral artery disease. The drug candidate has successfully completed Phase 2A trials and is awaiting Phase 2B testing to treat the disease and the pain associated with peripheral artery disease.
In addition, JanOne has a wholly owned subsidiary called ALT5 Sigma, which is a fintech company that provides next-generation blockchain powered technologies. The company processed $289 million in cryptocurrency transactions in April and May combined, which was a 91% increase from a year ago.
JanOne offers an interesting way to invest in biotech and also play the cryptocurrency space. The stock is up 333% this year and gets an “A” rating in the Portfolio Grader.
Ocugen (OCGN)
Person holding smartphone with logo of US biopharmaceutical company Ocugen Inc. (OCGN) on screen in front of website. Focus on phone display. Unmodified photo.
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As a small biotech company headquartered in Pennsylvania, Ocugen (NASDAQ:OCGN) is making its mark by developing and commercializing gene and cell therapies.
The company is also getting a nice boost on June 28 when it joins the Russell 3000 index, which measures the performance of the largest 3,000 U.S. companies. Its inclusion means that Ocugen stock will be included in exchange traded funds and products that track the Russell 3000.
Ocugen is working on a breakthrough modifier gene therapy product that might treat multiple retinal diseases with a single product. It also has several products in various phases of testing to treat eye diseases.
Ocugen showed $13.2 million in operating expenses for the first quarter and had $26.4 million of cash on hand. It posted a loss of 5 cents per share versus a loss of 8 cents per share a year ago.
Losses for small biotech companies are to be expected as it takes time and money to bring new therapies to market. But OCGN stock is one of the better penny biotech stocks you can buy, as the stock is up 124% so far this year. It gets an “A” rating in the Portfolio Grader.
Kuke Music (KUKE)
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Kuke Music (NYSE:KUKE) is a digital music company in China. The company is a leading provider of classical music licensing, subscriptions and smart education services in China.
The company leverages its diverse content offerings and experience in music education to provide smart music education products, including Kuke smart pianos and Kuke smart teaching systems.
The company is also the organizer of the Beijing Music Festival and is working to get into the AI music field through a partnership with Shanghai Jidou Science and Technology, which will see Kuke lauch an AI music application through a digital automotive software platform that Jidou develops for more than a dozen automotive companies.
Kuke and its subsidiaries reported revenue in 2023 of 106.9 million Chinese yuan ($14.7 million) and a loss of 65.8 million Chinese yuan. But the AI music partnership provides a path for Kuke to turn those losses into profits.
KUKE stock is up 101% this year and gets an “A” rating in the Portfolio Grader.
Jin Medical (ZJYL)
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Jin Medical (NASDAQ:ZJYL) is another Chinese penny stock. The company makes and sells wheelchairs and other products for the elderly and those with disabilities.
The company operates two manufacturing plants with approximately 228,257 square feet in the aggregate in Changzhou City and Taizhou City, Jiangsu Province, China. And it has relationships with more than 40 distributors in China and distributors in 20 other regions.
The majority of the company’s wheelchair products, which includes 30 models, are sold in China and Japan.
As a Chinese company, Jin doesn’t report its financials as often as those based in the U.S. But its most current financial report for the 2023 fiscal year (ending Sept. 30, 2023), included revenue of $19.8 million, up 3% from a year ago.
Profits of $6.7 million were up 9.5% from the 2022 fiscal year, and total net income of $2.87 million was a 6.3% improvement from the previous year.
ZJYL stock, which had its initial public offering only a year ago, is having a rough 2024. The company performed a 20-for-1 stock split, which brought the stock price down from $217 to roughly $13.50. However, the stock has been slipping ever since, and is down in penny stock territory.
However, I’m expecting a rebound based on the company’s financials, and the stock currently maintains its “A” rating in the Portfolio Grader.
Caravelle International (CACO)
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Caravelle International (NASDAQ:CACO) is a global ocean technology company with headquarters in Singapore. The company has routes to 50 companies and serves more than 100 ports.
Caravelle’s innovation lies in its work with shipping and lumber industries. The company invented a patent pending process called CO-Tech, which uses the heat from its ships’ exhaust to dry wood during transportation.
Caravelle says the process is an improvement from the lumber industry’s practice of building and maintaining wood drying facilities and the energy required to heat the wood in those facilities.
Contrast this to the traditional wood desiccation process where lumber companies must build and maintain expensive wood drying facilities, spend money on energy to heat the wood, and emit massive amounts CO2.
The company already has a memorandum of understanding with the government of Gabon to provide dried timber. If it can expand the business model to other governments, Caravelle may have a groundbreaking business on its hands.
CACO stock is up 63% this year, but is still priced at less than $1 per share. It gets an “A” rating in the Portfolio Grader.
Eco Wave Power (WAVE)
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Eco Wave Power (NASDAQ:WAVE) is a clean energy company that develops electricity from the power of ocean waves.
If you’ve ever been caught in a rough surf you know that even those waves can pack a punch, so imagine the power that an ocean wave can provide should we be able to harness that power and turn it into a clean source of electricity.
The company’s floaters can be attached to human-made structures to simplify installation and maintenance. The floaters draw energy from incoming waves by converting the rising and falling motion into a clean energy generation process.
The company currently works with customers in Israel, Portugal, Los Angeles and Gibraltar, a British territory.
While there was no revenue in the first quarter and the company sustained an operating loss of $659,000, management has high hopes that the company’s clean energy solution will be a powerful argument for coastal cities.
WAVE stock is up 79% this year and gets an “A” rating in the Portfolio Grader.
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
