10 Best AI Penny Stocks to Buy According to Analysts

4. Nerdy Inc. (NYSE:NRDY)

Average Upside Potential: 257.57%

Share Price as of November 5: $0.90

Number of Hedge Fund Holders: 14

Nerdy Inc. (NYSE:NRDY) is an online education company that operates a platform for live learning, primarily through its flagship service, Varsity Tutors. It connects students of all ages with tutors and subject matter experts across a range of subjects using advanced technology, including AI. The platform offers various learning formats, such as one-on-one tutoring, small group classes, and adaptive self-study tools, aiming to provide personalized educational experiences.

The company reported mixed financial results for Q3 2024. While the company achieved revenue of $37.53 million, in line with expectations, a 6.86% year-over-year decline was recorded due to a decrease in average revenue per member (ARPM) to $893. This shift towards lower-frequency learning memberships suggests a focus on AI-powered personalized learning experiences that require less frequent interaction with human tutors.

Despite the revenue decline, Nerdy Inc. (NYSE:NRDY) made significant progress toward its key goals. The company invested in product enhancements to improve the quality and reliability of live learning, and expanded access to its Varsity Tutors for Schools platform, reaching 1.1 million students, bringing the total to 4.4 million. These efforts demonstrate its commitment to making high-dosage tutoring accessible through its AI-powered platform.

Looking ahead, the company remains optimistic about the growing demand for live, AI-powered tutoring. Its focus on high-dosage tutoring and its strong financial position with $65 million in cash on the balance sheet position it well to capitalize on this trend.