Financial stocks are experiencing some volatility right now due
to the prospect of new reforms in the industry, and
penny stocks
in this sector are even more aggressive right now. Of course, it's
worth noting that this "jumpy" movement in financial penny stocks
is only a bad thing if you're caught on the wrong side of the move.
A penny stock that jumps 10% upwards in one day is showing some
volatility you can be pleased with!
Of course, penny stocks in any sector carry bigger risk because
of this price movement. And frankly, the financial sector is much
more aggressive than other industries in the wake of the financial
crisis and more recently the prospect of a financial reform bill
and the recent
Goldman Sachs
(
GS
) fraud allegations. But again, this greater risk allows for
greater reward if you play your cards right.
As a growth guy, I normally steer clear of many financial stocks
simply because they don't offer up the fundamentals necessary to
pass my exhaustive stock screening system. I demand significant
sales and earnings growth, and banks rarely show this type of
performance quarter to quarter.
Except, this is, banks that trade as
penny stocks
. These up-and-comers can see explosive growth since they have a
much higher ceiling, as opposed to a Goldman Sachs or a
Bank of America
(
BAC
) that can't significantly increase its reach since operations are
already so massive.
Last week, I offered up a list of
12 bank stocks to buy and 12 financial investments
to sell
. I want to follow up this week with you and offer 5 additional
penny stocks in the financial sector that are investments worth
your money right now. I don't use the term penny stocks literally
of course, just for any stock that's cheap - in this case, less
than $2.
Let's take a look as some of my favorite penny stocks in the
financial sector:
Penny Stock to Buy - Ladenburg Thalmann (
LTS
)
Sub-Sector:
Capital Markets
Market Cap:
$240 million
52-week range:
$0.45 - $1.65
Portfolio Grader Stock Grade:
B - Buy
Ladenburg Thalmann Financial Services Inc.
(
LTS
) provides investment banking and research services in the U.S.
Though the company has not turned a profit in a few quarters, it
keeps narrowing its loss and is showing good momentum. The stock
also has seen significant buying pressure, hitting a new 52-week
high at the end of April before the market's antics in May pushed
shares of this penny stock down a bit.
Penny Stock to Buy - Hanmi Financial (
HAFC
)
Sub-Sector:
Commercial Banks
Market Cap:
$90 million
52-week range:
$1.02 - $4.26
Portfolio Grader Stock Grade:
B - Buy
Hanmi Financial Corp.
(
HAFC
) provides general business banking products and services in the
United States, primarily in Southern California. Like Ladenburg,
HAFC stock has seen a few quarters in the red but is improving its
fundamentals. This penny stock is trading at the low-end of its
52-week range and could be near a big turnaround.
Penny Stock to Buy - Grubb & Ellis (
GBE
)
Sub-Sector:
Real Estate Management
Market Cap:
$88 million
52-week range:
$0.55 - $2.35
Portfolio Grader Stock Grade:
B - Buy
Grubb & Ellis Co.
(
GBE
) is a commercial real estate services and investment management
company. As with the other penny stocks, GBE has seen its quarterly
losses narrow recently - in fact, it cut its EPS loss in half from
-88 cents two quarters ago -41 cents in its most recent quarterly
report. This stock has been improving in anticipation of a recovery
and was up 40% year-to-date before the May swoon took most of those
gains back.
Penny Stock to Buy - GSC Investment (GNV)
Sub-Sector:
Capital Markets
Market Cap:
$29 million
52-week range:
$1.35 - $3.80
Portfolio Grader Stock Grade:
B - Buy
GSC Investment Corp.
(
GNV
) is a public investment firm specializing in buyouts, acquisitions
and recapitalization plans. After a rough two years across many
sectors of the economy, there are some great buyout opportunities
out there that have been made very affordable. GNV is pouncing on
those, and could be on the cusp of some breakout growth.
Penny Stock to Buy - Consumer Portfolio Services (
CPSS
)
Sub-Sector:
Consumer Finance
Market Cap:
$26 million
52-week range:
$0.46-$2.27
Portfolio Grader Stock Grade:
B - Buy
Consumer Portfolio Services Inc.
(
CPSS
) is a specialty finance company that engages in purchasing and
serving retail automobile contracts originated by franchised
automobile dealers. As auto sales have picked up, so has the
business done by CPSS. This penny stock is turning around fast and
is up 29% year-to-date.
These
penny stocks
all have great potential this week according to my latest stock
analysis. But remember that these aggressive picks can change in a
hurry, so make sure you have the most current research before
making any trades. Also remember that penny stocks by nature are
volatile and can gap up dramatically on low volume. Always use a
limit order when buying these thinly-traded stocks.
As of this writing, Louis Navellier did not own any of the
stocks mentioned here in personal or client portfolios.
About Portfolio Grader: Every Sunday, renowned growth stock
expert Louis Navellier runs a fundamental analysis on the top
5,000 Wall Street companies. Armed with this research, Navellier
offers a rating for each company reflected as a simple letter
grade, with A being "strong buy" and F being "strong sell."
Portfolio Grader's stock data is free and open to the
public and can be accessed online here
.