Top Penny Stocks to Watch for 2025

Penny stocks refer to stocks which trade at $5 per share or less. Their market cap is usually micro — under $300 million in total stock equity.

That’s the official definition at least. In spirit, these low-priced stocks are volatile and sketchy. They sell hope like other companies sell products. Despite it all, penny stocks are still the best way to build a small account quickly.

3 Penny Stocks to Watch in 2025

My top stock picks — rated on chart pattern, price action history, and catalyst — include the following:

3 Top Penny Stocks to Watch in July 2025

My top 3 penny stocks to watch in July 2025 are:

• AMEX: GPUS — Hyperscale Data Inc. — The Earnings Winner With Sketchy Penny Stock Catalysts
• NASDAQ: PONY — Pony.ai Inc. — Big Partnerships With a Breakout Setup
• NYSE: QBTS — D-Wave Quantum Inc. — Quantum Speculation Meets Real Headlines

There’s no guarantee I’ll trade any of these stocks. I’m watching them to see if they match my preferred setups — only then will I trade them.

The best traders watch more than they trade — that’s what I’m trying to model here.

Here’s some background info on penny stocks:

• What is the most promising penny stock?

A stock with a lot of volatility like Hyperscale Data Inc. (NYSE: GPUS) is a good bet for the most promising penny stock. Remember, we’re traders, not investors. We’re watching the stocks on this list for short-term moves, not predicting which of these stocks will still be around in 2030.

• What are the top 3 penny stocks to buy now?

My top 3 penny stocks to buy now (as long as their price action is strong) are Hyperscale Data Inc. (NYSE: GPUS), Pony.ai Inc. (NASDAQ: PONY), and D-Wave Quantum Inc. (NYSE: QBTS).

• Which penny stocks have a “Strong Buy” analyst rating?

Analysts don’t give any penny stocks “strong buy” ratings. These stocks are sketchy and unstable, and should never be investment targets. Always trade with a plan.

Let’s get to the picks …

Hyperscale Data Inc. (AMEX: GPUS) — The Earnings Winner With Sketchy Penny Stock Catalysts

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GPUS exploded 400%* after announcing strong Q1 results and unveiling new crypto developments. The company’s BitNile.com unit launched Nile Coin on the Solana blockchain, backed by a $164.5 million market cap and a fixed 500 billion token supply. With its move to integrate its coin into its gaming platforms, this gives the stock exposure to both social gaming and crypto payment trends.

That kind of dual-catalyst setup — blockchain integration plus AI data center plans — can attract fast-moving speculative traders. I’ve traded plenty of crypto-adjacent penny stocks over the years, and I always teach students to look for this combo: revenue momentum plus a hot sector narrative. GPUS fits that mold. After the spike, it pulled back sharply, but if the crypto breakout continues and Nile Coin gains traction, we could see another leg up.

This isn’t a company with deep earnings or fundamentals right now, but that’s not the point. Stocks like this are trading vehicles, not long-term investments.

Keep your eye on volume surges and set alerts around breakout levels using StocksToTrade. Use the volatility to your advantage — but always know your risk before jumping in.

Pony.ai Inc. (NASDAQ: PONY) — Big Partnerships With a Breakout Setup

Pony AI has gained over 160%* in just the last month on the back of two major announcements: its new robotaxi system with Toyota and a partnership with Uber to launch autonomous rides in the Middle East. That’s a powerful one-two punch of catalyst and credibility.

This is the type of stock I train students to recognize early — low float, major partnerships, and explosive short-term gains. It’s behaving like a textbook supernova runner: fast move, short consolidation, and the potential for a secondary breakout if momentum returns.

It’s again approaching all-time highs.

There are long-term valuation concerns here, but in penny stock trading, price action matters more than fundamentals. Ride the waves when the chart confirms your setup. Don’t chase, and don’t overstay. When stocks like PONY run, they can give you fast profits if you’re prepared. Be ready, not reactive.

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D-Wave Quantum Inc. (NYSE: QBTS) — Quantum Speculation Meets Real Headlines

QBTS had a 150%* rally earlier this year and just hit headlines again with a massive revenue beat — $15 million for Q1, up 500% from last year. That’s real momentum for a company in the high-risk, high-reward quantum sector. But it’s not without controversy. An active fraud investigation looms in the background, which may scare off some — but it also means a potential squeeze setup.

This is why I tell traders to react, not predict. QBTS isn’t about fundamentals right now — it’s about headlines, patterns, and emotional reactions. The stock is unpredictable, but the right chart setup can present real opportunity. These are the kind of stocks that squeeze hard when the crowd piles in the wrong way.

Right now, QBTS is flirting with all-time highs in the $11s. If it can break above this level, all bets are off … particularly those risky short seller bets — at last count, short interest measured over 17%!

In my teaching, I focus on preparation — watchlists like this are your first step. Whether it’s QBTS or another volatile runner, your edge comes from reacting to price, not guessing headlines.

*Past performance does not indicate future results

Top Stocks Under $5

Hot sector penny stocks — whether we’re talking AI penny stocks, biotech penny stocks, or another sector attracting a lot of news — are something traders should always be looking at. The allure lies in the potential for substantial returns on investment, as even minor developments or positive news within these sectors can lead to significant price jumps.

It’s important to proceed with caution and a well-thought-out strategy. The inherent volatility of penny stocks, combined with the speculative nature of emerging sectors like renewable energy and tech innovations, underscores the importance of a meticulous approach. Before diving in, ensure you’ve done your due diligence, looking past the initial excitement to assess the true potential and risks of these ventures. It’s wise to trade these stocks rather than invest long-term, given their unpredictable nature.

Success in trading hot sector stocks priced under $5 hinges on a selective and strategic approach. The goal is to tap into their explosive growth potential while implementing robust risk management practices. By zeroing in on companies making news in their specific niches, traders can seize opportunities for disproportionate gains. This strategy, coupled with a disciplined approach to maintaining a tight investment strategy and promptly cutting losses, can pave the way for trading success in these dynamic market segments.

How to Use This Penny Stocks Watch List

My watchlists aren’t rocket science. They’re a product of paying attention to what’s already happened.

The stocks on this list are former runners with recent news. That means I’m not the only one paying attention to them.

You should use this list as a model for your own watchlists.

Don’t just copy the stocks on this list. Learn my selection process and create your own.

Sign up here and I’ll send you a new NO-COST watchlist every week.

Can You Trade Penny Stocks?

Penny stocks get a bad rap, especially from Wall Street types.

Sure, 99% of them are crap. Some are even outright scams aiming to take money from their stock customers.

But where else can you earn 15-30% profits on a single day trade?

Penny stocks are only bad if you start to believe the hype. Take Ocean Biomedical (NASDAQ: OCEA), a biotech penny stock that’s had some early 2023 spikes on positive news for its cancer treatment candidate.

It’s got an awesome story to sell. And — just maybe — they’ll become the maker of a front-line cancer treatment.

But you know who I’d bet on instead? Eli Lilly and Co. (NYSE: LLY), a $300-billion company with several FDA-approved cancer treatments already on the market.

They’ve got a $7 billion R&D budget. So yes, they’ll probably beat OCEA to any game-changing advancements.

If you buy a penny stock thinking it will become the next Amazon, you’re basically buying a lottery ticket. That can be fun, but it’s no way to build your trading account.

The right way to go about it requires discipline and a good trading plan.

What Are the Advantages of Investing in Penny Stocks?

Slow down — there are zero advantages to investing in penny stocks.

Here’s the disclaimer: penny stock investments fail 99.9% of the time. Sure, there are some penny stock ETFs that post decent gains…

But that isn’t one of the purposes of why I’m writing this article. And it shouldn’t be what you’re reading for…

Day trading is what penny stocks are good for.

Here’s why!

You Can Buy Many Shares at a Low Price

Let’s table the fact that these companies have cheap stocks because their goods and services aren’t in demand…

We’re playing a different game here. It isn’t about underlying value. It’s about rampant speculation, which you can trade on.

If you want to read my take on value stocks, I’ve got a watchlist here!

You Can Start Trading with a Small Account

If you’re a small account trader, you can’t be content with the 10% gains that larger accounts target. Your needs are different. Thankfully, penny stocks can give you that opportunity.

These volatile stocks have a much greater range than pricier, established stocks. You can grab the conservative 5–10% gains I target in a single trade.

I go for singles, not home runs. The $7.4 million I’ve earned in my career is proof that small gains add up.

Easy to See Gains

Take a look at this $1,152 trade I made in minutes on Wisekey International Holding (NASDAQ: WKEY) — starting stake $3,120.

That’s an almost 37% gain on some feel-good news about a meeting with Elon Musk.

No sales came out of this meeting. Within a couple hours, the share price fell to lower than where I entered the trade.

I realized these gains because I didn’t get greedy. Everybody sees the gains that penny stocks are capable of — but they tend to ignore the collapses.

Remember this chart well, its the basis for my 7-step framework, @30DayBoot & @completepenny & you must study not to fall prey to greed/ignorance or you'll get wrecked like 90% of traders. It's VITAL to sell into excessive strength/hype, do not just hold & hope like most newbies pic.twitter.com/QsAGHsI6lp

— Timothy Sykes (@timothysykes) February 28, 2021

Competition is Low

The reviews are in: most penny stocks are scams. That’s why “smart” traders stay away — they’re liable to collapse at any minute.

You’re within your rights to stay away from these dangerous stocks. But agile traders can ride the waves of speculation to gains — as long as they cut their losses quickly.

Possible Price Growth

Not every penny stock collapses like WKEY. Some show days, weeks, or months of growth… before collapsing.

Penny stock growth can be tricky even if you’re looking at their charts. For example, look at the chart of EV stock Arrival (NASDAQ: ARVL).

The chart says that it ran up past $1,500 in 2020… but that’s accounting for the 1-for-50 reverse split ARVL conducted to get back to Nasdaq’s $1 share minimum.

Potential Risks of Investing in Penny Stocks

You mean, besides for blowing up your account? Let’s run it down…

High Volatility

Traders like me like volatility. Investors don’t.

Your job as a trader is to profit from volatility, do NOT fall in love with any trade or asset as a trade is not profitable until you lock in your profits & getting emotional can muddy the waters. Similarly, it's difficult to cut losses fast if you become too emotionally involved

— Timothy Sykes (@timothysykes) December 7, 2021

When you trade, you can profit off these moves. When you “hold and hope,” you go wherever the penny stock takes you — usually straight down.

Low Liquidity

Win or lose, you need liquidity to exit a trade. Many penny stocks trade at such a low volume that you can’t exit when you need to.

Pump-and-Dump Scams

Pumps are the religion of penny stock land.

The penny stock trenches are full of scammers, spammers, and deluded newbies…

Their religion is that their asset of choice is “going to the moon.” Even if they end up selling at a loss, they’ll be back on the train as soon as the next pump starts.

Lack of Information

This is why Wall Street stays away from penny stocks — they can usually make any claims they want because their books are cooked.

Some of my favorite penny stocks to trade are OTC pink sheet stocks. These are unlisted stocks that don’t publish sufficient financial information to meet exchange requirements. That means you don’t know if they’re lying about any of their outrageous claims.

I have a simple solution for this. Assume that every tweet out of a penny stock promoter is a lie, and trade as safely as you can!

5 Tips on How to Choose the Best Penny Stocks to Watch

I want my students to become self-sufficient. Like I said before, my watchlists aren’t rocket science. I build them by sticking to these five steps.

Tip #1: Look for Big Percent Gainers

How do you find hot stocks? The first step is learning to use the right stock screener tools.

I use StocksToTrade — a powerful trading platform with more than 40 built-in scans. It doesn’t hurt that some of them were tailored around my strategies.

I scan in premarket to know what’s moving. Penny stocks that know the game often put out PR in premarket. This gives traders the whole day to send their stock prices up before they dilute.

I typically look for 10% gainers. These are the stocks that the rest of the market has their eyes on.

Tip #2: Look for Big Volume

Volume is the proof of demand. If a stock has enough volume — on a small amount of shares — that’s a good sign that the price will continue to move.

Plus, big daily trading volume usually signifies liquidity. Even if you lose money on these stocks, you can always unload them quickly.

Tip #3: Look for a Penny Stock News Catalyst

The ‘product’ of most penny stocks is their own stock. They want to pump it up, then the stock’s insiders can trade into this built-up demand.

A lot of penny stock traders will believe anything, but I won’t. I want to see real news and events behind a stock move before I trade it. News catalysts can come from anywhere — Instagram, newsletters, actual news outlets …

News catalysts usually come from companies that are frequently in the public eye. Find penny stock companies for your watchlist with a strong media presence and you’ll be prepared for future catalysts.

You can look on the internet for news — or better yet, check out my favorite news alert service, Breaking News Chat!

EVERYONE needs to use the @StocksToTrade social media search tool & breaking news tool, they’ll open your eyes to what’s happening these days across so many chat rooms/websites/“communities”, pretty amazing to see the pumping of stocks like $FWP $GNUS $FRSX $CREX

— Timothy Sykes (@timothysykes) May 13, 2020

Breaking News Chat is my secret weapon — and the key to a good number of my recent trades.

Add Breaking News to your arsenal for the next 2 weeks — it’s $17 to try out!

Tip #4: Look at the Long-Term Charts

I talk about former runners a lot. That’s one reason I’ll research a stock’s long-term chart…

If I know it has run in the past, I’ll know it can do it again. And looking at its past performance data can help me tell the difference between a multi-day runner and a one-and-done spike.

My usual advice still stands — react, don’t predict. Don’t research past data trying to predict when the stock’s going to run. Research it to understand the effect that unusual volume and news has on the stock, so you can react faster.

I don’t do anything too complicated with my charting and analysis. I’ve been using my 7-step pennystocking framework for the past 10 years…

I still use it because the game hasn’t changed.

Check out my 7-step framework here.

Tip #5: Use the Twitter Scanner on StocksToTrade

You have to know if a stock is being pumped before you trade it. Twitter is the first place all the wannabe influencers go to hype up a stock.

If you’re wary about getting sucked into the Twitter hellscape, StocksToTrade is way ahead of you. Using the built-in Twitter scanner, you’ll have access to a running feed of stock tweets.

You can even customize the feed if you like.

Get your 14-day StocksToTrade trial HERE — only $7.

If Most Penny Stock Companies Fail, Why Not Just Short Sell?

Shorting is the easiest way to blow up your account. And it’s even more dangerous now that retail traders know the signs of high short interest.

Since GameStop squeezed on short interest close to 120%, they’ve been out for blood.

When you buy a stock, you can only lose what you put into the position. When you short sell, you risk all the money in your account.

Of course, you can hit your targets as a short seller. Many of my top students focus on short selling, the same way I did a decade ago. But the number of messages and comments I get almost daily from short sellers getting caught in short squeezes is … scary.

How Much Money Do I Need to Get Started?

Many brokers have done away with minimums for cash accounts. But that isn’t the cost you should be worried about. The market will take your money if you’re unprepared.

Education is what separates the winners and losers in trading.

Trading gurus can point you to all the “trading opportunities” you ask for. All the market information, resources, and updates in the world mean nothing if you don’t understand the basis for a good trade.

But fear not — giving new traders their education is what I was put on this earth to do!

I’ve been trading for more than 20 years. During that time, I’ve made over $7.4 million in career earnings.

That isn’t what I’m most proud of. It’s that more than 30 of my Trading Challenge students have developed into millionaire traders.

This didn’t happen because they got hot stock picks. I was relentlessly honest about my successes and failures and taught them to be that way too.

How Do You Become a Millionaire Trader?

You don’t become a millionaire trader by trying to impress your Twitter followers with results, like so many other ‘gurus’ do. You get there by being honest with them, and yourself. That’s why I’m always honest with my students — ESPECIALLY about my failures. I’ve even written articles about failures and how to recover from them.

Because they’re not real failures if I’m following my rules, and cutting my losses quickly. When I lose, I want to show my students the right way to trade. That’s the secret to becoming a self-sufficient trader — knowing how to manage your losses.

Join My Trading Challenge Today

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We don’t accept everyone. We like to limit our community to people who are humble, people who work hard.

Think you’ve got what it takes? Apply to my Trading Challenge today!

Conclusion

Penny stocks can be a blessing or a curse — it’s all in your trading strategy.

Key points:

• Trading penny stocks can be risky due to lack of company information, making transparency and communication key factors to consider.
• These stocks could experience rapid growth … or just as easily experience rapid collapses!
• I NEVER invest in penny stocks, I only trade them. That means trading with a plan both for your entry AND exit.

If you’re new to this, start paying attention. Study the things I teach.

Trading is a battlefield. The more knowledge you have, the better prepared you’ll be.

Working hard is the only way to survive in penny stock land.

What’s on your penny stock watchlist? Let me know in the comments!

FAQs

What Are Penny Stocks?

Penny stocks trade for five dollars or less per share. Institutional investors usually won’t touch them. Why? Some factors include their low cost, which makes them ripe for speculation and big-time volatility, and their lack of sustained growth. Some are listed on the major exchanges, others trade on the OTC markets.

Are Penny Stocks Worth It?

I like penny stocks because they give traders with small accounts a way to quickly make 10% or more on a trade.

Are Penny Stocks Dangerous?

Penny stocks are only dangerous when you trade without a plan, risk money you can’t afford to lose, and don’t cut your losses quickly. These mistakes are why penny stocks have gotten a bad rap.

How Do You Watch Penny Stocks?

Check out the article for a detailed rundown… I make a new penny stock watchlist every day, and keep a roster of other watchlists as well.

Can You Become a Millionaire from Penny Stocks?

It’s possible for a trader to become a millionaire from penny stocks — just ask the 30+ Trading Challenge students I’ve helped cross that threshold. The tricky part is how you can become a millionaire from these shady stocks. It isn’t by picking the right stock, and holding on for dear life. It’s by learning the patterns and techniques I teach my students.

How Often Do Penny Stocks Go Big?

Penny stocks go big often… but then they usually collapse. Don’t be suckered in by the big gains some penny stocks make. The way to trade penny stocks profitably is to sell into strength, and get out before all your potential profits disappear.

What Have Been the Most Successful Penny Stocks?

The most successful penny stocks include the likes of GameStop Corp. (NYSE: GME), Plug Power Inc. (NASDAQ: PLUG), Advanced Micro Devices (NASDAQ: AMD)… and oh yeah Apple Inc. (NASDAQ: AAPL). But don’t let this fill you with FOMO. Penny stocks aren’t lottery tickets. Don’t trade on a hunch, trade with a plan.

What Do Analysts Say About Penny Stocks?

Analysts generate reports on various penny stocks to watch. They look at the business operations of these companies and provide analyst ratings that give an overview of market sentiment. These reports can influence investment decisions, and in turn create demand or lack thereof.

What Markets Are Most Common for Penny Stocks?

Penny stocks can be traded in various markets. Many are listed over-the-counter, while others may have their bids placed in international markets like Canada or China. Knowing the type of market can influence your investment strategy.

How Can I Stay Updated on Penny Stocks?

To keep up with the latest trends and news on penny stocks to watch, consider subscribing to specialized newsletters or becoming a partner in trading forums. They often provide links to additional resources, and some even offer insights under their ‘light’ subscription plans.