12 Stocks Under $5 With Biggest Upside Potential

10. Kosmos Energy Ltd. (NYSE:KOS)

Upside Potential: 77.99%

Stock Price as of January 17: $3.59

Number of Hedge Fund Investors: 27

Kosmos Energy Ltd. (NYSE:KOS) is a full-cycle deepwater oil and gas exploration and production company with a diverse portfolio of assets around the world. The company focuses on assets in the Atlantic Margins, including offshore fields in Ghana, Equatorial Guinea, and the Gulf of Mexico.

Kosmos Energy Ltd. (NYSE:KOS) is executing a multi-faceted strategy that involves investing in new projects, enhancing existing operations, and prioritizing free cash flow generation. In the Gulf of Mexico, the company has achieved first production at the Winterfell project and completed two production enhancement projects at Kodiak and Odd Job, which are performing well. Additionally, Kosmos Energy Ltd. (NYSE:KOS) is making progress on its drilling campaign in Equatorial Guinea, which is expected to contribute to the company’s goal of growing production by 50% to around 90,000 barrels of oil equivalent per day.

Kosmos Energy Ltd. (NYSE:KOS) is also focused on enhancing its financial resilience and discipline. The company has taken steps to extend maturities, enhance liquidity, and simplify its capital structure. The company has no maturities in 2025 and only a small stub in 2026, which is expected to be paid with free cash flow from the business. Furthermore, Kosmos Energy Ltd. (NYSE:KOS) is actively managing price volatility through its rolling hedging program, with around 45% of its first-half 2025 oil production hedged at a downside protection of approximately $70 per barrel.