3 penny stocks that have the power to multiply your $1,000 investment 10x

Today we’re looking at three penny stocks that have the power to multiply your $1,000 investment 10x. The three companies discussed below have great potential to turn smaller capital allocations into much larger returns.

Two of the three companies discussed below have very strong driving forces. The other company operates in the notoriously volatile biotechnology sector. Either way, all three have untapped potential. Penny stocks are no different from other stocks in that great companies make great stocks. As always, use caution and stick to more traditional investment styles for the majority of your funds.

With that in mind, let’s take a closer look at each company.

Lithium America (LAC)

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lithium america (New York Stock Exchange:rack) is one of the two companies mentioned above and has very strong tailwinds driving its stock price forward.

You might not know it from the name, but this company is a lithium mining company. The company has acquired mining rights to the Tucker Pass lithium deposit, one of the largest on the planet. The company recently began construction of a mining operation at this location.

Lithium Americas is expected to begin producing lithium in 2026. While that may seem like a long time, it may actually be the best time for the company to be up and running. Lithium prices remain low and may remain so for some time.

Simply put, its large reserves make Lithium Americas a strategically important company for domestic EV production. So it’s no wonder the government gave the company his $2.26 billion loan. This is a good example of the idea that the company may be too big to fail.

Compass Therapeutics (CMPX)

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compass therapeutics (NASDAQ:CMPX) is very similar to many other biotech stocks that penny stock investors find. Full of potential and highly regarded by analysts, it is still in the pre-monetization stage and has the potential to generate 10x returns.

Once again, the biotech sector is also lacking penny stocks with similar potential. Investing in this type of asset is essentially gambling. Analysts view Compass Therapeutics like other biotech penny stocks, expecting clinical programs to drive potential revenue streams.

What may set Compass Therapeutics apart from other companies is the fact that it has made further advances in oncology treatment. Several of its therapeutic indications have progressed into phase 2 and 3 studies, meaning it is much closer to commercialization. Again, there is no guarantee of success. That’s why we said this is a gamble, which is reflected in the potential for return.

Soundhound AI (SOUN)

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Soundhound AI (NASDAQ:early clouds) stock is currently trading above $8. It’s obviously going to be difficult for the company’s stock to go up 10x just because of what that means in terms of price. But it’s a connection to a company. Nvidia (NASDAQ:NVDA) The possibility is clear.

A recent 13F filing by Nvidia revealed that the company owns 1.73 million shares of SoundHound AI. The company also invested $75 million in funding for SoundHound AI in 2017.

This 13F filing was the first to reveal Nvidia’s significant position in SoundHound AI. So why is Nvidia paying attention to his SoundHound AI? The answer is because SoundHound AI is particularly good at conversational AI. Most of its services revolve around AI used in call centers and restaurants. Nvidia has experienced explosive growth thanks to its generative AI utilities. Conversational AI could be the next growth area for AI. If so, SoundHound AI is the stock to invest in.

About penny stocks and small stocks: With rare exceptions, InvestorPlace does not publish commentary on companies with a market capitalization of less than $100 million or with fewer than 100,000 shares traded each day. That’s because these “penny stocks” often become a playground for scammers and market manipulators. When publishing commentary about small-capitalization stocks that may be affected by our commentary, we require InvestorPlace.com writers to disclose this fact and alert readers to the risks.

Read more: Penny stocks — How to make money without getting scammed

On the date of publication, Alex Sirois did not have (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer and are influenced by InvestorPlace.com. Publishing guidelines.