The NASDAQ is known for hosting high-tech companies. Once a small upstart exchange, NASDAQ started out as nothing more than an electronic quotation system. Today it hosts some of the world’s largest companies. The exchange is best known for listing powerhouse tech stocks, but it hosts stocks from virtually every sector. There are thousands of NASDAQ penny stocks to choose from, but many of them are going nowhere. To find winners, you’ll have to do your research.
Best NASDAQ Penny Stocks
To choose our top NASDAQ penny stocks picks, we looked at companies with high trading volume and market caps greater than $300 million. These stocks are some of the more solid penny stocks on the NASDAQ. If you’re looking for more speculative picks, be sure to check our best stocks under 1 dollar article.
- For even more penny stock picks, check out our monthly picks here: https://www.thestockdork.com/penny-stocks/
Groupon, Inc. (NASD: GRPN)
Groupon is a very popular platform for businesses of all sizes to promote themselves and their products. Millions of Americans have the Groupon app on their phone and use it regularly to shop for deals on all kinds of goods and services.
This stock has been the subject of buyout rumors for a long time. It’s core platform boast over 46 million active users, and that kind of direct access is extremely valuable in today’s business landscape. Experts believe Groupon would be a great buyout target for a larger tech company, like Google and Yelp.
If one of the large tech companies pulls the trigger on Groupon, it could be a catalyst for a rally.
Plug Power Inc. (NASD: PLUG)
NASDAQ penny stocks are known for hosting high-tech companies, and Plug Power is on the cutting-edge of the renewable energy sector. The company develops and manufactures hydrogen fuel cell systems for material handling and stationary power markets.
One of Plug’s flagship products is GenDrive, a fuel cell system that powers electronic vehicles for handling materials. The firm also offers hydrogen fuel delivery, storage, and dispensing via its GenFuel service. Finally, GenCare helps maintain and support GenDrive fuel cells.
Plug Power is one of the market leaders in this sector. It’s definitely worth watching.
TherapeuticsMD, Inc. (NASD: TXMD)
TherapeuticsMD produces women’s healthcare products and therapeutic solutions. The firm is developing several different types of hormone therapy drugs, and it also has several different lines of branded and generic prenatal vitamins. Some of the company’s brands include vitaTrue, vitaPearl, vitaMedMD, and BocaGreenMD Prena1. It also produces Annovera, a line of ring-shaped vaginal contraceptives.
The stock has been on fire since August 2019, around when it released a blowout Q2 earnings report and raised its revenue forecast for the year. After a disappointment in the first quarter, investors were expecting more bad news. The report turned out to be a lot better than expected and the market adjusted share prices accordingly.
Extraction Oil & Gas (NASD: XOG)
It feels like most Wall Street analysts are bearish on oil and gas stocks these days, but is the business really doomed? Renewables have a long way to go before they can supply all of the world’s energy needs, so energy stocks aren’t going anywhere anytime soon. In fact, some of these stocks are excellent value picks.
Extraction Oil & Gas acquires, develops, and produces oil and natural gas resources in the Rocky Mountain region of the U.S. It also constructs and supports mid-stream energy assets to gather and produce crude oil and gas. The company is currently taking flak for its fracking business, but its value ratios are compelling, to say the least.
XOG is trading for only 5.56 profit times earnings, and its price to book ratio is a scant 0.27. If this company can manage to survive the energy onslaught and see its valuation return to base levels, it could be a big winner in a year or two. Keep an eye on this one.
ViewRay, Inc. (VRAY)
ViewRay is pioneering MRI machines that work in conjunction with targeted radiation therapy for the treatment of tumors. Their machines are among some of the first MRI machines than can be used simultaneously with radiation treatments. Simultaneous monitoring and treatment allow doctors to instantly correct radiation dosages and reduces damage to healthy tissue.
The company’s flagship machine, the MRIdian scanner, just became one of the first of its kind in New England. A cancer hospital in Boston purchased the machine and it will now be the first hospital in the region to offer simultaneous, MRI-targeted radiation therapy for cancer patients.
Where to trade NASDAQ Stocks?
You can trade NASDAQ penny stocks with just about any U.S. broker. Even mobile trading apps, like WeBull and Robinhood, offer access to NASDAQ listed stocks. If you have a broker, you should be able to trade NASDAQ stocks.
If you don’t have a broker, you have a lot of options. Practically every major broker on the market offers zero-commission trading these days, so it’s easy to get started. All you need is a U.S. bank account and a smartphone to get started.
One good option is WeBull. Check out our review here to get all the facts on this mobile trading app. WeBull includes a built-in paper trading platform, so it’s easy to get started. You can also check our Robinhood review here.
Keys to Trading Penny Stocks on NASDAQ
Trading on NASDAQ is the same as trading on any other exchange. Once you have a broker, you probably won’t even notice whether stocks are listed on NYSE or NASDAQ because the procedure for trading stays the same. If you’re brand new to penny stocks, learn more about getting started here.
Have a Strategy.
As always, sound strategy and strict discipline are the keys to success in trading penny stocks. Before entering a trade, have a game plane. Look at the chart, identify your entry and exit points, and figure out how much capital you’re willing to risk.
Do Your Homework.
However, there’s a lot more to consider than the daily candlestick, one-year chart. You need to do some due diligence if you plan on holding these stocks for any longer than a day or two. Read press releases, balance sheets, income statements, and other key financial data.
Know What You’re Buying.
A good way to determine if you’ve done your research is to try and explain your trade. If I ask you, “why did you buy that company,” you should be able to give me a good answer. Just FYI, don’t say “I heard them talk about it on CNBC” or, “my friend told me about it”. Knowing what you’re trading will help you make more educated decisions and, worst case, you’ll feel a lot better about taking a loss if you know you did your homework.
One of the most fundamental skills investors can have is patience. If a trade isn’t going your way, don’t panic. Keep a cool hand and follow your predetermined trading plan.
If penny stocks are a little too risky for your appetites, check out our picks for the best stocks under 10 dollars. They’re more stable investments. Also, learn about safe harbor assets by reading our best gold stocks.
If you’re thinking about trading cheap stocks, NASDAQ penny stocks are a great place to start. Since all of these companies meet NASDAQ’s highly-regulated listing requirements, they tend to be much more stable and credible than OTC penny stocks. Remember, trading penny stocks is risky, so exercise an appropriate amount of caution before laying your hard-earned cash on the line. Most importantly, always do your due diligence and be sure to consult with a professional advisor before making any significant financial decisions.
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