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3 Hot Penny Stocks Due to Double in 2024

Talking about penny stocks with a 12-month return potential of 100% seems too conservative. In the euphoric rally of 2021, some of the hot penny stocks skyrocketed by 100% in a matter of days. It’s better to have toned-down expectations than to tend toward an unrealistic zone in challenging macroeconomic conditions.

It’s also important to note that the first objective of the portfolio is to beat inflation. Even if a few penny stocks fire, overall portfolio returns would look robust. Of course, I would look beyond 10% to 15% portfolio returns. That can be achieved through some high-quality growth stocks.

Returning to penny stocks, my focus is on fundamentals, not speculation. Some attractive penny stocks represent quality businesses. I would not hesitate to hold the discussed stocks beyond the next year for potential multi-bagger returns.

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Let’s talk about the reasons that make these penny stocks worth considering.

Curaleaf Holdings (CURLF)

An image of different forms of medical marijuana
An image of different forms of medical marijuana

Source: Bukhta Yurii/Shutterstock

Curaleaf Holdings (OTCMKTS:CURLF) is among the undervalued penny stocks worth buying for a big rally next year. For year-to-date, CURLF stock has corrected by 12% and seems to be consolidating around $3.5.

An important point to note is that cannabis is legalized in almost 50% of U.S. states. Further, a new bill has been tabled in the U.S. House to federally legalize cannabis. I must add that even without federal legalization, the U.S. cannabis market is expected to be worth $71 billion by 2030. With positive industry tailwinds, Curaleaf seems well-positioned to benefit.

For Q3 2023, Curaleaf reported revenue and adjusted EBITDA of $333 million and $75 million, respectively. Further, free cash flow for the quarter was $33 million.

While revenue growth was muted, an annual FCF visibility of over $100 million is a big positive. It provides Curaleaf with the flexibility to invest in research and development. Additionally, the Company can invest in European expansion, potentially boosting revenue growth.

I must add that Curaleaf is “bullish for a strong end to 2023 and an exciting 2024.” This might be an indication of growth acceleration and an impending rally.

Hecla Mining (HL)

Gold bars and Financial concept, studio shots. Costco's gold bars, cost stock
Gold bars and Financial concept, studio shots. Costco's gold bars, cost stock

Source: Misunseo / Shutterstock.com

I am bullish on precious metals performing next year. With the possibility of multiple rate cuts, gold and silver are likely to be among the performing asset classes.

Kinross Gold (NYSE:KGC) is a penny stock that I have previously discussed. Another name that’s likely to be a winner is Hecla Mining (NYSE:HL). It’s worth noting that HL stock has been sideways for the last 12 months. Upside in precious metals is likely to be a big breakout catalyst.

An important point is that the Company’s production was impacted in 2023 due to Lucky Friday suspension. However, Hecla has guided the resumption of operations in 2024. Further, the Company’s Keno Hill asset is likely to boost production.

Hecla has maintained its guidance to produce 20 million ounces of silver by 2025. If production growth in the coming years is associated with a higher realized price, Hecla is positioned for a significant upside in cash flows. I would, therefore, use slightly negative sentiments to accumulate HL stock.

Polestar Automotive (PSNY)

Polestar Automotive (NASDAQ:PSNY) stock has witnessed a sharp correction of 60% year-to-date. The electric vehicle stock, however, looks oversold, and I expect a strong rally from current levels of $2.1.

It’s important to note that the weakness in PSNY stock has been due to cash burn coupled with lower production guidance. However, the Company is already working towards cutting costs. EBITDA losses are likely to narrow next year.

At the same time, I expect delivery growth to accelerate. It’s worth noting that the first delivery of Polestar 4 is due before the beginning of 2024. Further, Polestar 5 is also due for launch next year. Both these models will ensure that delivery growth is robust next year and in 2025.

I must add that Polestar has a presence in 27 markets globally. Presence in North America, Europe, and Asia Pacific, coupled with introducing new models, will boost growth and support operating leverage.

On the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modeling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.

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