11 Best Quality Penny Stocks to Buy According to Hedge Funds

Page 9 of 9

1. Marqeta, Inc. (NASDAQ:MQ)

Revenue CAGR in the last 5 years: 38.16%

Net profit margin: 5.38%

Number of Hedge Fund Holders: 37

​​​As a financial technology company, Marqeta, Inc. (NASDAQ:MQ) specializes in modern card issuing and payment processing solutions. Its open cloud-native platform enables businesses to create customized debit, credit, and prepaid card programs with features like Just-in-Time funding, dynamic spend controls, and tokenization for digital wallets. MQ operates globally and serves a diverse clientele across industries such as digital banking, on-demand services, expense management, and “Buy Now, Pay Later” providers.

Marqeta, Inc. (NASDAQ:MQ) demonstrated strong financial performance in Q4 2024, with Total Process Volume (TPV) reaching $80 billion, representing 29% YoY growth. The company achieved a net revenue of $136 million (14% YoY growth), a gross profit of $98 million (18% YoY growth), and an adjusted EBITDA of $13 million with a 9% margin. The company’s European business showed remarkable momentum, with Q4 TPV growth exceeding 100%, indicating successful international expansion.

Marqeta, Inc. (NASDAQ:MQ) is focusing on three key strategic pillars: deepening platform breadth, expanding solutions offered, and strengthening leadership in payments innovation. Notable developments include securing an agreement to offer American Express network options later in 2025, acquiring TransactPay to enhance European program management capabilities, and seeing significant growth in real-time decisioning risk product revenue, which more than doubled from 2023 to 2024. The company expects 2025 net revenue growth between 16% and 18%, with TPV growth in the mid-to-high 20s, and is on track to achieve GAAP profitability by the end of 2026.

Overall, MQ ranks first on our list of the 11 best quality penny stocks to buy according to hedge funds. While we acknowledge the potential of MQ to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than MQ but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT:  20 Best AI Stocks To Buy Now and 30 Best Stocks To Invest In According to Billionaires

Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.

Page 9 of 9