In this article, we will take a detailed look at 10 Pump and Dump Stocks Favored by Hedge Funds.
Pump and dump stocks are typically characterized by high 52-week volatility, often experiencing rapid price surges followed by sharp declines. While the term “pump and dump” carries a negative connotation, it doesn’t necessarily mean the company is of low quality or incapable of delivering long-term returns – it simply refers to the extreme price fluctuations it exhibits. Traders can profit from these stocks by capitalizing on momentum, buying during the early stages of a price surge, and selling before the inevitable decline. However, timing is crucial, as these stocks can reverse quickly. Risk management, liquidity analysis, and understanding market sentiment are key to navigating these trades successfully. Also, readers should remember that positions in such stocks could exhibit pronounced volatility overnight, and day trading is often the preferrable form of dealing with them.
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Hedge funds gain their information edge through a combination of proprietary research, advanced data analytics, high-frequency trading algorithms, and access to exclusive market insights which are often not accessible to regular investors. Unlike traditional investors, many hedge funds are not focused on long-term value but instead engage in short-term speculation and trading. They may exploit pump and dump stocks by identifying momentum in its early stages, riding the price surge, and exiting just before the downturn (often a moment when the stock gains widespread attention). Some hedge funds even take the opposite approach, shorting these stocks as they peak, profiting from the subsequent decline. Their ability to leverage real-time data, options strategies, and market microstructure analysis gives them a significant advantage over retail traders in volatile market conditions. The key takeaway for readers is that finding “pump and dump” stocks with significant hedge fund ownership could offer unique confirmation for potential short-term trading opportunities, as institutional involvement may indicate informed positioning ahead of major price movements.
Pump and dump stocks become increasingly more attractive during times of pronounced market volatility and uncertainty. Though slightly below the early March peak, the volatility index is still significantly above its moving average and reflects February’s weaker-than-expected batch of economic indicators and investor’s concerns about the likely near-term negative impact of Trump 2.0 policies. Many market participants certainly do not like the tariff turmoil and the shotgun approach in reducing the federal workforce and spending. Several reputable research boutiques, such as Yardeni Research, substantially increased their odds of the US economy entering a recession in 2025. Since the US economy and stock markets work in unison, the year-end targets for the US broad market index were lowered as well. Here’s a snippet for a recent publication from Yardeni Research:
“Vertigo is a sensation of spinning or whirling such that the person or their surroundings appear to be moving. The stock market didn’t do much today, but everything else seemed to be spinning. The epicenter of all this vertigo continues to be the White House. More and more economists are increasing their odds of a recession. We raised ours to 35% a week ago. JP Morgan’s economists raised their odds to 40% today.”
With current market valuations still elevated vs. the previous decade, the risk of a broad market meltdown persists, favoring short-term traders and speculators. Another advantage of engaging in pump-and-dump strategies is the potential to generate profits even in bear markets through short selling and the use of options strategies. However, the downside is that high volatility can work both for and against the trader. Therefore, we advise exercising increased caution when engaging in such strategies. With that being said, here are the 10 pump and dump stocks favored by hedge funds.
Source: Pexels
Our Methodology
We used Finviz to filter companies that have high 52-week volatility. Then we compared the list with our proprietary database of hedge funds’ holdings, as of Q4 2024 and included in the article the top 10 stocks with the highest hedge fund ownership. It’s important to clarify that calling these companies “pump and dump stocks” does not mean these firms don’t have any solid fundamentals or long-term growth catalysts. We call them pump and dump purely due to their volatility and high risk.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. Telesat Corporation (NASDAQ:TSAT)
Number of Hedge Fund Holders: 9
Telesat Corporation (NASDAQ:TSAT) is a global satellite operator providing broadband connectivity and communications services to commercial and government customers. The company operates a fleet of geostationary (GEO) satellites and is developing Telesat Lightspeed, a low Earth orbit (LEO) satellite constellation designed to enhance global broadband coverage. TSAT serves industries such as telecommunications, aeronautical and maritime mobility, enterprise networking, and government defense. Its services include satellite-based internet, video distribution, and secure communications. The company generates revenue through long-term contracts with telecom providers, broadcasters, and government agencies, leveraging its infrastructure for high-reliability, low-latency connectivity solutions.
In Q3 and the first nine months of 2024, Telesat Corporation (NASDAQ:TSAT) delivered results aligned with expectations, with revenues projected at the upper end of guidance and adjusted EBITDA surpassing predictions. A key highlight was the closing of Lightspeed funding late in the quarter, which catalyzed excellent progress in program execution and strengthened partnerships with key suppliers. Customer engagement has surged since securing full funding, with potential users across various industries recognizing the advantages of LEO and Lightspeed’s advanced features. Meanwhile, in the GEO segment, TSAT renewed its agreement with EchoStar for Nimiq 5, albeit with reduced capacity and revenue – approximately a third of previous payments. Additionally, a restructured contract with Canadian ISP Explorer will conclude in Q3 2025, trimming revenue next year by $4 million but remaining neutral at the EBITDA level.
Financially, Telesat Corporation (NASDAQ:TSAT) reported Q3 2024 revenues of $138 million and adjusted EBITDA of $96 million, ending the period with $1.1 billion in cash. Notably, significant debt reduction efforts saw the company repurchase a total of $849 million in principal debt at a cost of $459 million, leading to $54 million in annual interest savings. Looking ahead, management aims to support the Lightspeed program through workforce expansion, with plans to increase headcount by 40% by the end of the year. With a robust foundation in place, the company remains optimistic about Lightspeed’s market potential and its ability to generate substantial value for customers and stakeholders. With high volatility in the last 52 weeks and 9 hedge funds owning the stock, TSAT is one of the pump and dump stocks favored by hedge funds.
9. D-Wave Quantum Inc. (NYSE:QBTS)
Number of Hedge Fund Holders: 15
D-Wave Quantum Inc. (NYSE:QBTS) is a technology company specializing in quantum computing solutions for commercial and enterprise applications. It develops and sells quantum annealing systems, such as the Advantage quantum computer, designed for optimization problems in industries like finance, logistics, manufacturing, and artificial intelligence. QBTS also offers cloud-based access to its quantum systems through the Leap platform, enabling businesses to integrate quantum computing into their workflows. The company generates revenue from hardware sales, cloud services, and professional consulting, positioning itself as a leader in practical quantum computing solutions for real-world problem-solving.
D-Wave Quantum Inc. (NYSE:QBTS) achieved several significant milestones in Q4 2024 and early 2025, positioning itself as a leader in the quantum computing industry. The company demonstrated quantum supremacy on a real-world problem, outperforming classical computers in solving a complex magnetic material simulation. This groundbreaking achievement was published in a peer-reviewed paper in Science, marking the first demonstration of quantum supremacy on a useful problem with relevance to current customer needs. QBTS secured its first sale of an Advantage annealing quantum computing system to the Jülich Supercomputing Center in Germany, leading to record quarterly bookings of $18.3 million in Q4 2024. The company’s financial position strengthened significantly, with over $300 million in cash on hand, which management believes is sufficient to reach sustained profitability.
D-Wave Quantum Inc. (NYSE:QBTS) continued to make progress on its technical development, including the calibration of a third 4,400 qubit Advantage2 processor, which offers significant performance improvements over the current Advantage system. The company is expanding its go-to-market strategy, introducing programs like Quantum Uplift and Leap Quantum LaunchPad to accelerate the adoption of its quantum computing technology.
QBTS expects Q1 2025 revenue to exceed $10 million, driven largely by the installation and acceptance of the Jülich system. The company is also exploring new areas of application for its quantum technology, particularly in AI and machine learning, where it sees potential for significant advancements in training speed and energy efficiency. With high volatility in the last 52 weeks and 15 hedge funds owning the stock, QBTS is one of the pump and dump stocks favored by hedge funds.
8. Rigetti Computing, Inc. (NASDAQ:RGTI)
Number of Hedge Fund Holders: 17
Rigetti Computing, Inc. (NASDAQ:RGTI) is a quantum computing company focused on developing and commercializing superconducting quantum processors. It builds and operates quantum computers, integrating them with classical computing systems to provide hybrid quantum-classical solutions. The company offers cloud-based access to its quantum hardware through its Quantum Cloud Services (QCS) platform, targeting applications in machine learning, optimization, and material science. RGTI serves enterprise, government, and research customers, generating revenue through cloud subscriptions, partnerships, and government contracts. Its competitive focus is on scaling quantum processors and improving error correction to advance practical quantum computing. The California-based company ranked tenth on our recent list of 12 Best Multibagger Stocks to Buy in 2025.
Rigetti Computing, Inc. (NASDAQ:RGTI) has embarked on a significant strategic partnership with Quanta Computer Inc., where both companies have pledged investments exceeding $100 million over the next five years to drive advancements and commercialization in superconducting quantum computing. In December 2024, Rigetti introduced its 84-qubit Ankaa-3 system, which incorporates a groundbreaking hardware redesign, delivering improved performance with a median iSWAP gate fidelity of 99.0% and a median fSim gate fidelity of 99.5%. RGTI’s modular architecture, designed for seamless integration across the technology stack, sets it apart in the quantum computing space. To achieve scalability, the company is leveraging a chiplet strategy, with plans to showcase 36 qubits by mid-2025 and more than 100 qubits by year-end, while also striving to halve error rates.
December 2024 marked key commercial milestones for Rigetti Computing, Inc. (NASDAQ:RGTI), including the sale of its first quantum processing unit to Montana State University and an additional Novera system to the UK government. Financially, the company reported Q4 2024 revenue of $2.3 million with a gross margin of 44%. RGTI’s robust cash position of $217.2 million in cash, equivalents, and investments, as of year-end 2024, is anticipated to sustain its operations for the next three years. While management believes that wide-scale commercial applications of quantum computing remain four to five years away, the company continues to prioritize research and development milestones to lay the groundwork for future growth. Looking forward, its focus on technological advancements and strategic collaborations positions it for long-term success in the emerging quantum computing market. With high stock price volatility in the last 52 weeks and 17 hedge funds owning the stock, RGTI is one of the pump and dump stocks favored by hedge funds.
7. ECARX Holdings Inc. (NASDAQ:ECX)
Number of Hedge Fund Holders: 19
ECARX Holdings Inc. (NASDAQ:ECX) is a global automotive technology company specializing in smart vehicle computing platforms. It develops hardware and software solutions, including digital cockpits, infotainment systems, and advanced driver-assistance system (ADAS) platforms, enabling connectivity and automation in modern vehicles. ECARX serves major automakers, particularly in China and international markets, providing integrated solutions that enhance user experience and vehicle intelligence. The company generates revenue through product sales, software licensing, and partnerships with automotive manufacturers, positioning itself as a key player in the digital transformation of the automotive industry.
ECARX Holdings Inc. (NASDAQ:ECX) demonstrated strong performance in 2024, with revenue increasing by 18% year-over-year to RMB 5.6 billion and gross margins of 20.8%. The company achieved a significant milestone by reaching EBITDA breakeven in Q4 2024, with an adjusted EBITDA gain of RMB 74 million. This improvement was primarily attributed to decreased operating expenses and gains from partial sales of an equity investment. ECX’s total shipments reached a record high of 2 million units in 2024, up 33% YoY, with over 8.1 million vehicles on the road incorporating their technology by year-end.
ECARX Holdings Inc. (NASDAQ:ECX) expanded its global customer base to 18 automakers across 28 brands, securing a notable project win with Volkswagen Group. ECX continued to innovate, releasing its AutoGPT in-vehicle AI large language model application and integrating multiple LLMs. The company’s focus on diversifying its revenue streams is evident, with plans to increase non-Geely business from 20% in 2024 to approximately 50% by 2027-2028. Looking ahead, management is prioritizing breakeven plans in 2025, while continuing to invest in R&D and expand the company’s global presence. The company is also exploring options for capital raising, including equity or debt financing, to support its strategic objectives. With high stock price volatility in the last 52 weeks and 19 hedge fund holders, ECX is one of the pump and dump stocks favored by hedge funds.
6. Mineralys Therapeutics, Inc. (NASDAQ:MLYS)
Number of Hedge Fund Holders: 20
Mineralys Therapeutics, Inc. (NASDAQ:MLYS) is a clinical-stage biopharmaceutical company focused on developing therapies for cardiovascular and metabolic diseases. Its lead product candidate, lorundrostat, is an aldosterone synthase inhibitor designed to treat hypertension by targeting aldosterone-driven high blood pressure. The company aims to provide a more precise and effective approach for patients with uncontrolled or treatment-resistant hypertension. MLYS generates value through clinical development, regulatory approvals, and potential commercialization or partnerships with pharmaceutical companies, positioning itself in the growing market for targeted cardiovascular therapies.
Mineralys Therapeutics, Inc. (NASDAQ:MLYS) has announced positive top-line data from two pivotal hypertension trials, Launch-HTN and Advance-HTN, for their novel aldosterone synthase inhibitor, lorundrostat. The Launch-HTN trial, the largest aldosterone synthase inhibitor trial to date, demonstrated significant blood pressure reductions, with the 50-milligram once-daily lorundrostat arm showing an absolute reduction of 16.9 mmHg and a 9.1 mmHg placebo-adjusted reduction in systolic blood pressure at week 6, which was sustained and potentially further reduced at week 12. The Advance-HTN trial, conducted in partnership with the Cleveland Clinic, showed highly statistically significant results on the primary endpoint, with a 7.9 mmHg placebo-adjusted reduction in systolic blood pressure as measured by 24-hour ambulatory blood pressure measurement at week 12. Lorundrostat demonstrated a consistent safety and tolerability profile across both trials, with a modest impact on potassium levels.
These results position lorundrostat as a potentially transformative option for patients with uncontrolled and resistant hypertension, addressing a significant unmet medical need for the estimated 15 million to 20 million patients in the United States alone. Mineralys Therapeutics, Inc. (NASDAQ:MLYS) believes that the clinical profile of lorundrostat as a best-in-class aldosterone synthase inhibitor could have the potential to extend and improve the lives of millions of patients, with approximately 30% of all hypertension patients dealing with elevated or dysregulated aldosterone. MLYS plans to continue advancing its commercial and partnering activities to maximize the value of lorundrostat, which they consider a potential first-to-market aldosterone synthase inhibitor. With high stock price volatility in the last 52 weeks and 20 hedge funds owning the stock, MLYS is one of the pump and dump stocks favored by hedge funds.
5. Cryoport, Inc. (NASDAQ:CYRX)
Number of Hedge Fund Holders: 20
Cryoport, Inc. (NASDAQ:CYRX) is a global provider of temperature-controlled supply chain solutions for the life sciences industry. It specializes in cryogenic logistics for biopharmaceuticals, including cell and gene therapies, clinical research, and reproductive medicine. The company offers specialized packaging, monitoring, and transportation services to ensure the integrity of temperature-sensitive biological materials. CYRX serves pharmaceutical companies, research institutions, and fertility clinics, generating revenue through logistics services, storage solutions, and equipment leasing. Its infrastructure supports regulatory-compliant, end-to-end supply chain management for critical biological shipments worldwide.
Cryoport, Inc. (NASDAQ:CYRX) concluded 2024 with solid results, achieving total annual revenues of $228.4 million in line with expectations despite a challenging year for life sciences. The Life Sciences Services business demonstrated strong performance with double-digit YoY growth in Biostorage and Bioservices revenue, representing 67% of total revenue compared to 62% the previous year. The company saw significant growth in commercial cell and gene therapy support, with revenues increasing by 37% in Q4 and 20% for the full year. CYRX supported a record 701 clinical trials by year-end, including 81 Phase III trials, and increased its commercial programs from 14 to 19.
Cryoport, Inc. (NASDAQ:CYRX) made substantial progress in improving its gross margin, which rose to 45.8% in Q4 2024 compared to 40.6% in the same period last year. Looking ahead to 2025, management provided revenue guidance in the range of $240 million to $250 million and expects to achieve positive adjusted EBITDA during the year. The company launched new initiatives including IntegriCell cryopreservation facilities in Houston and Liege, and introduced the revolutionary CXHV3 shipping system, positioning itself for future growth in the cell and gene therapy industry. Management anticipates 23 BLA or MMA filings could occur in 2025, up from 11 last year, with 3 filings already completed in January. With high stock price volatility in the last 52 weeks and 20 hedge fund holders, CYRX is one of the pump and dump stocks favored by hedge funds.
4. Bally’s Corporation (NYSE:BALY)
Number of Hedge Fund Holders: 21
Bally’s Corporation (NYSE:BALY) is a gaming and entertainment company that owns and operates casinos, racetracks, and online gaming platforms. Its portfolio includes land-based casinos across multiple US states, offering slot machines, table games, and sports betting. BALY also operates iGaming and sports betting through Bally Bet and other digital platforms, expanding its presence in the online gambling market. The company generates revenue from gaming operations, hospitality services, and digital gaming, leveraging its brand and infrastructure to compete in both traditional and online gambling industries. The US-based company ranked 12th on our list of 13 Best Vacation Stocks to Buy Now.
Bally’s Corporation (NYSE:BALY) reported relatively stable third-quarter results for 2024, with revenues declining less than 1% YoY to $630 million. The Casinos & Resorts segment saw a 2% decrease in revenue, while the North America Interactive segment grew by 55%. The company’s UK Interactive business performed strongly, generating a 12% increase in revenues, although the overall International Interactive segment experienced a 5% revenue decline due to non-UK operations. BALY is making progress on several development projects, including the construction of its flagship permanent casino in downtown Chicago, which is expected to open in September 2026.
Bally’s Corporation (NYSE:BALY) is also planning developments in Las Vegas at the Tropicana site and pursuing a casino license in New York. In the North America Interactive segment, Bally’s iGaming operations in Rhode Island are ramping up impressively, contributing $9.7 million in gross gaming revenue. The company’s online sports betting platform, Bally Bet, is now live in 10 markets with plans to expand to additional states. Despite some challenges in specific markets like Rhode Island and Atlantic City, management remains confident in the overall resiliency of their customer base and is implementing efficiency-focused initiatives to enhance profitability. With high stock price volatility in the last 52 weeks and 21 hedge funds owning the stock, BALY is one of the pump and dump stocks favored by hedge funds.
3. Ramaco Resources, Inc. (NASDAQ:METC)
Number of Hedge Fund Holders: 22
Ramaco Resources, Inc. (NASDAQ:METC) is a metallurgical coal company engaged in the mining, processing, and sale of high-quality metallurgical coal used primarily in steel production. The company operates mines in the US, with a focus on low-cost, high-yield coal extraction. Its customers include domestic and international steel manufacturers, and it generates revenue through long-term supply contracts and spot market sales. METC emphasizes efficient production, reserve expansion, and sustainability initiatives to strengthen its position in the global steel supply chain.
Ramaco Resources, Inc. (NASDAQ:METC) had a strong Q4 2024, with record tons sold, cash costs under $100 per ton, and record liquidity levels despite challenging market conditions. The company managed to maintain cash margins of $33 per ton in Q4, down only $2 from Q2 despite a $30 drop in met coal prices. METC’s cash margins were nearly 50% higher than the next highest public peer in Central Appalachia for both Q3 and Q4. The company is seeing significant supply reductions in the US met coal market, with potentially 16 million tons of production coming out by the end of 2025.
Ramaco Resources, Inc. (NASDAQ:METC) expects the met coal prices to potentially increase in the second half of 2025 due to supply tightening and increased demand from certain markets, which should provide a significant uplift for revenue growth. The company has plans to add approximately 2 million tons of low-vol production when market conditions improve, which would increase overall production to 6.5-7 million tons within 24-36 months. METC’s rare earth and critical minerals project in Wyoming is progressing, with mining set to begin in July and construction of a pilot processing facility starting in the fall. The company maintains a strong balance sheet with record liquidity of about $140 million at year-end 2024. With high stock price volatility in the last 52 weeks and 22 hedge funds owning the stock, METC is one of the pump and dump stocks favored by hedge funds.
2. NET Power Inc. (NYSE:NPWR)
Number of Hedge Fund Holders: 25
NET Power Inc. (NYSE:NPWR) is an energy technology company developing a proprietary natural gas power generation system with near-zero emissions. Its technology utilizes an oxy-combustion process in a supercritical CO₂ cycle to produce low-cost, dispatchable power while capturing nearly all carbon emissions without additional carbon capture equipment. The company targets utilities, industrial power users, and energy developers, aiming to commercialize its system as a cleaner alternative to conventional fossil fuel power generation. NPWR generates value through technology licensing, project partnerships, and potential power sales, positioning itself in the transition to low-emission energy solutions.
NET Power Inc. (NYSE:NPWR) completed the front-end engineering and design (FEED) for Project Permian (SN1), marking a significant milestone for the world’s first utility-scale, fully integrated clean gas power plant of its kind. However, the company faced challenges due to inflationary pressures and market conditions, resulting in a revised total installed cost estimate of $1.7 billion to $2 billion for SN1, up from the initial estimate of $950 million. In response, NPWR has shifted focus to a post-FEED optimization and value engineering exercise to reduce costs while maintaining performance. The company is also exploring opportunities for modular multi-unit deployments along the Gulf Coast, which could demonstrate further cost reductions.
NET Power Inc. (NYSE:NPWR) continues to advance its technology validation program at the La Porte demonstration facility, having achieved over 140 fired hours of operation during Phase 1 testing. The company maintains a strong liquidity position with $533 million in cash, cash equivalents, and investments at the end of 2024. Looking ahead, management aims to position the company as the lowest-cost source of clean firm power in the coming decade, focusing on improving technology, optimizing plant designs, and attracting strategic partners to unlock the technology’s potential. The company is also exploring new opportunities, including an industrial-scale NET Power solution developed in collaboration with Baker Hughes and Woodside Energy. With high stock price volatility in the last 52 weeks and 25 hedge funds owning the stock, NPWR is one of the pump and dump stocks favored by hedge funds.
1. Arvinas, Inc. (NASDAQ:ARVN)
Number of Hedge Fund Holders: 32
Arvinas, Inc. (NASDAQ:ARVN) is a clinical-stage biopharmaceutical company focused on developing targeted protein degradation therapies for the treatment of cancer and other diseases. Its proprietary PROTAC® (Proteolysis-Targeting Chimera) technology harnesses the body’s natural protein disposal system to selectively degrade disease-causing proteins. The company’s pipeline includes candidates for metastatic breast cancer, prostate cancer, and neurological disorders. ARVN generates revenue through research collaborations, licensing agreements, and potential future drug commercialization, positioning itself as a leader in the emerging field of targeted protein degradation.
Arvinas, Inc. (NASDAQ:ARVN) is approaching several major milestones, including their first Phase III top-line data results expected later in Q1 2025 and first-in-human data from their PROTAC targeting neurodegenerative disease. The company’s lead program, vepdegestrant (vepdeg), is being developed with Pfizer as a potential best-in-class ER-targeting backbone therapy for breast cancer treatment. In 2025, ARVN plans to initiate two Phase III combination trials – one evaluating vepdeg with Pfizer’s novel CDK4 inhibitor atirmociclib in the first-line setting, and another combining vepdeg with a CDK4/6 inhibitor in the second-line setting.
Arvinas, Inc. (NASDAQ:ARVN)’s neuroscience program made significant progress with ARV-102, their LRRK2 degrader, with first-in-human data to be presented at the AD/PD Conference in April. Additionally, ARVN plans to share preliminary data from their Phase I trial of ARV-393, their BCL6 degrader for non-Hodgkin lymphomas, and expects to file an IND application for their KRAS G12D degrader in 2025. Financially, ARVN maintains a strong position with over $1 billion in cash, cash equivalents, and marketable securities, sufficient to support operations into 2027. The company recorded $263.4 million in revenue for the year compared to $78.5 million in the prior year.
Overall Arvinas, Inc. (NASDAQ:ARVN) ranks first on our list of the 10 pump and dump stocks favored by hedge funds. While we acknowledge the potential of ARVN as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ARVN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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