Penny stocks have the potential to provide investors with triple-digit gains in a matter of months, weeks, or even days when good news breaks.
Just take a look at Marathon Patent Group Inc. (Nasdaq: MARA).
During the short Thanksgiving week in 2017, shares rose from $1.42 to $5.95, a gain of 319 percent.
And to help our readers know the penny stock to watch for potential triple-digit gains, we found one in the tech sector that could soar 100% in the next 12 months.
But before we share the name of this tech penny stock, we want to remind Money Morning readers of the risks of investing in this volatile sector.
You see, penny stock prices can climb triple digits just as quickly as they can plummet to zero.
For example, the VistaGen Therapeutics Inc. (Nasdaq: VTGN) stock price soared from $0.92 to $2.55 on Dec. 6, 2017.
Less than two weeks later, the share price plummeted back to $1.05, which would be a 58% loss for anyone who bought at the peak.
That’s why it’s important to invest no more money than you’re willing to lose and to make sure you’re only investing in legitimate companies with serious growth potential.
To help you do that, we ran a rigorous screen of all stocks trading under $5.
Here are the three rules we use to find the best penny stocks to buy.
- We only look at penny stocks that trade on major indexes, like the NYSE or Nasdaq, because they have more rigorous requirements for listings.
- We make sure that 12-month price targets are above the stock’s current price.
- We look for signs of fundamental strength, including growing sales, profits, cash flow from operations, as well as a compelling business model within a growing industry.
And after screening for the top penny stocks, we found a tech penny stock that hits all of those requirements, and it could climb 100% over the next 12 months.
This Tech Penny Stock to Watch Could Climb 100%
Neonode Inc. (Nasdaq: NEON) is a Swedish tech company that specializes in developing and licensing optical infrared touch systems and user interfaces.
The company’s technology can sense an object’s pressure, size, velocity, depth, and proximity to a surface. Neonode licenses its touch technology to original design manufacturers (ODMs) and original equipment manufacturers (OEMs), who integrate it into their devices.
Some of its technology is used in printers, laptops, monitors, all-in-one computers, and GPS systems.
A few of the top-name companies that Neonode works with include Canon, Sony, Samsung, HP, LG, Amazon.com Inc. (Nasdaq: AMZN), Epson, Alpine, and Bosch.
And one of the reasons analysts are bullish on NEON stock is because the company has a new CEO…
On Dec. 5, Neonode announced the resignation of its co-founder and former CEO, Thomas Eriksson.
He will continue as a member of the board and will support the company’s sales and development efforts as a senior advisor.
But the new CEO promises to be an asset for the future of the company.
On Feb. 12, the company announced it had appointed Hakan Persson as its new CEO, effective April 1, 2018.
Persson comes to Neonode most recently as the CEO of Precise Biometrics AB, a Stockholm-based, Nasdaq-listed company that develops secure identity verification solutions.
Persson has also held other leading positions, including CEO, director of sales & marketing, and business development executive for telecom and technology companies such as IBM, Telelogic, Scalado, and Telia.
Neonode’s Chair of the Board, Ulf Rosberg, has expressed that Persson’s solid experience in driving sales in tech companies and leadership will be a catalyst for the company’s future growth.
And rightfully so. Analysts are now bullish on the NEON stock price.
Investment banker Cowen and Co. projects that the NEON stock price will climb to $1.00 per share in the next 12 months.
From yesterday’s (March 12) opening price of $0.50 per share, that’s a potential profit of 100 percent.
*This has been a guest post by Money Morning*