The year is coming to an end, but bull markets continue to run rampant, boosted by improved sentiment following the presidential election. While the coming months will be a time of transition, a few things are likely. The expectation is that the Trump administration will pursue a much looser regulatory policy than the outgoing Biden administration. Plans for individual tax cuts are expected to boost consumer spending, while corporate tax cuts could provide an immediate boost to profits.
While recent market gains have been largely driven by blue chip giants, penny stocks are quietly attracting investors looking for untapped growth opportunities. Priced at less than $5 per share, penny stocks offer a unique combination of risk and return, with the potential to double or even triple initial investments.
The nature of these investments poses somewhat of a dilemma. How should investors separate the penny stocks that are poised to soar from the penny stocks that are stuck at the bottom? This is where Wall Street analysts come into play.
We used the TipRanks database to discover two attractive penny stocks that have earned Strong Buy ratings from the analyst community. According to the pros, these tickers will triple or more in the next year. Let’s take a closer look.
Genelux Corporation (GNLX)
The first cent in the spotlight is Genelux, a clinical-stage biotechnology company active in the world of immuno-oncology. Genelux’s research program is focused on developing the next generation of cancer treatments, using oncolytic virotherapies to create therapeutic agents that can target a broad range of cancer types. The company uses the vaccinia virus to selectively multiply in and kill tumor cells – while leaving the patient’s normal cells intact.
Genelux’s drug candidates target some of the harder-to-treat cancers, including a wide range of dangerous solid tumors, and are developed using the company’s CHOICE discovery platform. This is a proprietary platform that enables the rapid advancement of new treatment candidates from early discovery through clinical trial phases. Using its platform, Genelux has developed its leading oncolytic immunotherapy candidate, Olvi-Vec.
Olvi-Vec has been the subject of several early and mid-phase clinical trials, but the current excitement surrounding the drug candidate stems from the drug’s ongoing Phase 3 trial as an intraperitoneal (IPe) dosed treatment for platinum-resistant /refractory conditions. ovarian cancer (PRROC), a disease that is difficult to treat and has high unmet medical needs. The current Phase 3 trial will enroll up to 186 patients, and the company expects to announce topline results in the second half of 25.
In addition to the PRROC process, Genelux has also had Olvi-Vec undergo a phase 2 study for the treatment of non-small cell lung cancer (NSCLC). The interim readout for this trial is expected in the middle of next year.
Given these potential clinical milestones and GNLX’s current stock price of $2.63, several members of The Street think now is the right time to pull the trigger.
Roth MKM analyst Benjamin Paluch is particularly bullish, suggesting the Phase 3 ovarian cancer trial has the potential to be a game-changer for the stock.
“We view the top results from Olvi-Vec’s Phase 3 trial in platinum-resistant/refractory ovarian cancer as the key catalyst for the stock. Our base case is that the trial is successful and shows statistically significant progression-free survival (PFS)… Our base case assumes a 70% upside with a potential for a 100% gain under our bull case scenario and a downside potential limited to 30% below our bear case scenario. case scenario… Consider that the FDA granted Fast Track designation to Olvi-Vec for platinum-resistant/refractory ovarian cancer in November 2023, which leads us to believe that the FDA could be flexible in its review, especially in platinum-refractory patients for whom therapeutic options are available. limited,” said Paluch.
To that end, Paluch rates GNLX a Buy, along with a $10 price target. Should his thesis come true, a potential gain of 277% would be on the horizon. (To view Paluch’s track record, click here)
Other analysts do not believe this is different. 4 Buy ratings and no Holds or Sells have been assigned in the last three months. That’s why GNLX is a strong buy. The average price target of $15 implies the stock could soar 470% higher in the next year. (To see GNLX Stock Prediction)
SAB Biotherapeutics (SABS)
The next stock we’ll look at here is another biotherapeutics company, SAB. This company focuses on the treatment and prevention of immune and autoimmune diseases, a class of disease conditions known for the difficulties they pose to both patients and healthcare providers, in the form of dangerous symptoms and resistance to treatment.
SAB has developed an innovative genetic engineering platform, which it uses to create new therapeutic agents. The company aims to develop multi-targeted, potent immunoglobulins (IgGs) without the need for human donors or even the use of convalescent plasma. Although every biotech company likes to say it is unique, SAB is currently the only company in the world capable of producing a true polyclonal human antibody. without donor. These antibodies can be used to tackle diseases that pose serious health problems.
The company’s lead drug candidate, SAB-142, is a potential blockbuster if it succeeds. SAB-142 offers a novel approach to treating type 1 diabetes (T1D), through disease modification. This drug candidate represents a novel therapy for T1D as it is a potentially redosable human antibody that is being investigated for its ability to delay the onset of clinical symptoms in, or progression of, type 1 diabetes. SAB-142 is not insulin and does not require daily monitoring or treatment; the company even sees a good chance that the drug can be administered annually.
In May this year, SAB Biotherapeutics received approval from the FDA to begin Phase 1 clinical testing of SAB-142 in the US. Enrollment for the Phase 1 study has been completed and the company expects to have data readable by the end of this year. Initial data showed that there was no serum sickness in the enrolled patients. SAB also has a Phase 1 trial underway in Australia and expects to be able to read data by the end of the year.
These developments have caught the attention of Craig-Hallum analyst Albert Lowe, who took a closer look at the stock.
“We believe the company’s unique ability to produce human polyclonal antibodies (pAbs) offers profound opportunities for the development of new therapies, led by SAB-142. SAB-142 has a clear value proposition that builds on the clinically validated mechanism of action of rabbit ATG (rATG) in delaying the onset of T1D. As a human ATG, SAB-142 overcomes the safety limitations of rabbit ATG, making it a redosable disease-modifying therapy that enables long-term T1D disease prevention. We see opportunities for shared appreciation as SAB-142’s development progresses, with clinical data giving us confidence that SAB-142 may be a best-in-class therapy for the long-term prevention of T1D,” Lowe wrote.
In line with his bullish view, Lowe rates SABS a Buy and sets a price target of $11, implying a potential upside of 237%. (To view Lowe’s track record, click here)
Overall, all four recent analyst reviews of SABS are positive, making the Strong Buy consensus unanimous. The stock’s $3.26 trading price and $13.50 average price together imply a 323% upside over one year. (To see SABS stock forecast)
To find good ideas for trading penny stocks at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is for informational purposes only. It is very important to do your own analysis before making an investment.
