In this article, we will take a detailed look at 12 Penny Stocks with Insider Buying in 2025.
Insider trading can be a reliable signal for gauging the degree of confidence that management has in the future of their company. This practice has been supported for decades by leading investors and analysts, who claim that there is only one reason for insiders to buy shares of their own companies – if they strongly believe the share prices are going to rise significantly. We discussed the theory behind insider buying in one of our recent articles named 10 Large-Cap Stocks with Insider Buying in 2025.
Insider buying can be an even more significant signal in the case of penny stocks, which are usually small- or micro-cap companies, because these stocks are often underfollowed or not followed at all, leading to significant price inefficiencies and overreactions from investors. This, in turn, may create pockets of opportunity that insiders exploit by leveraging their confidential information and visibility. Furthermore, given the smaller market cap, insiders can exert significant upward pressure on the stock price, which may help boost morale among shareholders.
READ ALSO: 10 Technology Stocks with Insider Buying in 2024
Empirical studies suggest that small caps tend to underperform relative to large caps during tough economic conditions, such as slowing GDP growth, inflation, high interest rates, and other exogenous pressures. Many believe that the US has already entered a new regime, called “Trump 2.0,” which will be dominated by higher inflation, lower economic support from government spending, and reduced availability of cheap labor, among several other possible challenges. Some surveys have hinted at a deteriorating business outlook among small- and mid-sized businesses, marked by lower CapEx budgets. Yardeni Research charts show that small-cap forward earnings have lagged significantly behind large caps since 2023. On top of that, the new economic regime in the US could further exacerbate these discrepancies and lead to greater relative underperformance of small caps, including penny stocks.
While the aforementioned developments could be bad for existing penny stock investors, they could also create investment opportunities for new investors. As the US broad market is still trading near its all-time highs, it has become increasingly difficult to find undervalued or even fairly valued large- and mid-cap companies. In such an environment, investors seeking higher returns may turn to smaller, lesser-known stocks with strong growth potential. The key takeaway for investors is that penny stocks could offer much more attractive, high-upside opportunities than large caps, and watching insider buying signals provides further reassurance regarding stock picking. Given this, we will take a look at some of the best penny stocks with insider buying.
A closeup of investor hands holding a small-cap investment security.
Our Methodology
We used Insider Monkey’s insider trading stock screener to find penny stocks trading under $5.00 share price with at least two insiders buying shares worth at least $100,000 in the last six months. We believe that multiple insiders buying significant amounts of stock represents a higher chance that insiders have high confidence in the company. For all the companies, we also include the number of hedge funds holding stakes in them, tracked by Insider Monkey as of Q4 2024. The stocks are ranked according to hedge fund positions.
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).
12. 374Water Inc. (NASDAQ:SCWO)
Number of Hedge Fund Holders: 1
374Water Inc. (NASDAQ:SCWO) is a US-based cleantech company specializing in innovative waste and wastewater treatment solutions. Founded in 2018, the company has developed the patented AirSCWO™ technology, which stands for Air Supercritical Water Oxidation. This process effectively treats both hazardous and non-hazardous organic waste streams by oxidizing contaminants at high temperatures and pressures, resulting in safe, dischargeable water, mineral byproducts, vent gas, and recoverable heat energy. The technology has undergone extensive testing at bench, pilot, and commercial scales, demonstrating enhanced performance and safety. By transforming waste into minimal impact, value-added products, SCWO aims to support a circular economy and assist businesses and local governments in achieving their Sustainable Development Goals.
374Water Inc. (NASDAQ:SCWO)’s technology is positioned to address critical waste challenges with a solution that offers unmatched commercial efficacy and scale. The company has made substantial progress in commercializing its technology across both solid and liquid waste streams, building a robust backlog and pipeline of opportunities totaling more than $1.8 billion. The company’s AirSCWO system effectively processes solid waste that can be preprocessed into slurries for treatment, including wastewater sludges, biosolids, spent granular activated carbon, ion-exchange resins, and hard-to-degrade plastics, as well as liquid waste such as firefighting foam, industrial solvents, and foamate streams.
374Water Inc. (NASDAQ:SCWO) has also demonstrated significant success in AFFF destruction tests on their lab-scale system and commercial scale AS1 and AS6 systems, achieving 99.999% plus destruction results. The company operates in multiple market segments including the $120 billion US drinking water and municipal wastewater management market, the $15 billion US federal waste management market, and the $80 billion US industrial waste management market. The company is actively raising capital to expand operations and is pursuing near-term revenue opportunities across AirSCWO capital sales, emerging Destruction as a Service business model, destruction demonstrations, and lab tests. The significant insider purchasing in the last six months further reinforces the strong outlook and reinvestment opportunities of the company.
11. OncoCyte Corporation (NASDAQ:OCX)
Number of Hedge Fund Holders: 2
OncoCyte Corporation (NASDAQ:OCX) is a molecular diagnostics company focused on developing and commercializing non-invasive, liquid biopsy diagnostics for early cancer detection and monitoring. Their product portfolio includes a gene expression test that assesses the tumor microenvironment to predict responses to immunotherapies, and a blood-based tool for monitoring therapeutic efficacy in cancer patients. Additionally, OCX offers a clinical blood-based test for monitoring solid organ transplantation, and a research-use-only test in the same domain. The company collaborates with Bio-Rad Laboratories to develop and commercialize transplant monitoring products using their instruments and reagents.
OncoCyte Corporation (NASDAQ:OCX) is making significant progress in democratizing transplant testing, with their technology now being run on three continents. The company has successfully signed agreements with leading transplant centers, including a top 5 transplant center in the United States and Germany. OCX is actively engaging with more than 30 high-volume transplant sites and expects to meet or exceed their goal of having 20 sites signed by the end of next year. Each site is projected to generate approximately $1 million per year in high-margin recurring clinical test kit revenue.
OncoCyte Corporation (NASDAQ:OCX) is also advancing its FDA program, with their first FDA meeting scheduled for early December to discuss validation plans. Their GraftAssure RUO kit test is exceeding expectations in Europe, and they are establishing potential meaningful market share in the US. The company recently raised $10.2 million in gross proceeds through a private placement, with support from existing investors including Bio-Rad. In oncology, their DetermaIO immune classifier continues to show promising results, with a peer-reviewed study validating its utility in identifying breast cancer patients most likely to benefit from atezolizumab. Given the aforementioned achievements, it is no surprise that at least two insiders bought more than $100,000 worth of company stock in the last six months.
10. CAMP4 THERAPEUTICS CORPORATION (NASDAQ:CAMP)
Number of Hedge Fund Holders: 4
CAMP4 Therapeutics Corporation (NASDAQ:CAMP) is a clinical-stage biopharmaceutical company focused on developing regulatory RNA-based therapies to address a wide range of genetic diseases. Its lead product candidate, CMP-CPS-001, is designed for the treatment of urea cycle disorders, while another program, CMP-SYNGAP, targets synaptic Ras GTPase activating protein 1-related disorders. In October 2024, CAMP successfully raised $75 million through its initial public offering, selling 6.82 million shares at $11 each. The company plans to use the IPO proceeds primarily for the clinical development of its product candidates.
CAMP4 Therapeutics Corporation (NASDAQ:CAMP) is pioneering a new class of RNA medicines focused on increasing targeted gene expression through their proprietary RAP Platform, which enables the discovery of novel regRNAs that regulate the expression of every protein-coding gene. The company’s lead metabolic program has demonstrated promising safety results in Phase 1 SAD studies, with no safety trends of concern and no treatment-emergent serious adverse events observed.
CAMP4 Therapeutics Corporation (NASDAQ:CAMP) is also targeting significant market opportunities, including approximately 5,000 UCD patients in the US, with 3,700 severe patients and over 1,200 symptomatic OTC female heterozygotes. In their CNS pipeline, CAMP is developing treatments for SYNGAP1-related disorders, which affect over 10,000 patients in the US, where there are currently no disease-modifying treatments available. The company has also expanded into Parkinson’s disease through their GBA1 program, targeting a substantial market of approximately 100,000 GBA-PD patients in the US out of approximately 1 million total PD patients. CAMP’s technology platform has demonstrated the ability to increase target gene expression in multiple preclinical studies, with their lead candidate showing up to a 40% increase in ureagenesis in non-human primates. With that being said, the company’s promising outlook is supported by significant insider buying in the last six months.
