On January 20, Bloomberg reported that relief swept through the markets as it became clear that Donald Trump would not immediately impose China-specific tariffs on his first day in office, sparking a rally in US equity futures and a decline in the dollar. According to people familiar with the plans, the Trump administration is pivoting towards a more engagement-oriented approach with Beijing, rather than pursuing another trade war. The administration also plans to issue a memorandum directing federal agencies to study existing trade policies and relationships with China, Canada, and Mexico, rather than imposing new tariffs.
This change in strategy has been welcomed by investors, who were concerned that a trade war with China could have significant negative consequences for the global economy. The relief has propelled US equity futures higher, with contracts on the S&P 500 rising 0.5%. The dollar, on the other hand, slumped, with a gauge of the dollar dropping as much as 1.1%. Additionally, Trump’s conversation with China’s leader Xi Jinping, which he described as “very good”, boosted Asian stocks on Monday. However, not all markets were positive, after Trump announced plans to invoke emergency powers to boost domestic energy production while shifting away from renewable sources.
Read Also: 12 Cheapest Stocks with Biggest Upside Potential and Top 10 Undervalued Tech Stocks to Buy According to Hedge Funds.
In an interview with CNBC on January 20, Stanley Druckenmiller, Chairman and CEO of Duquesne Family Office, a financial services company, shared his insights on the markets and the incoming administration. Druckenmiller began by describing the current state of the economy, noting that the United States is experiencing a very low unemployment rate of around 4% and a strong GDP growth rate of 3%. He mentioned that, in his 49 years of experience, the country is likely transitioning from the most anti-business administration to the opposite, which has led to a significant shift in business confidence.
According to Druckenmiller, CEOs are feeling “somewhere between relieved and giddy” about the change in administration. He cited a recent statement by Paul Ryan that discussed a 32% increase in business confidence over the last 12 months, which Druckenmiller believed was likely a record. This surge in confidence, combined with the strong economic indicators, suggests that the economy will remain robust for at least the next six months. Druckenmiller’s firm is a believer in the concept of “animal spirits,” which refers to the idea that business confidence and sentiment can have a significant impact on economic activity.
Despite the positive economic indicators, Druckenmiller noted that the earnings yield to bond yield is at its most unattractive level in 20 years. This means that the return on investment in stocks is relatively low compared to the return on bonds, which could make it challenging for the market to continue its upward trend. As a result, Druckenmiller is cautious in his predictions, citing the push and pull between a strong economy and rising bond yields. He acknowledged that every change creates opportunities for price changes, and the radical shift in administration, combined with innovation and deregulation, could lead to significant disruptions in the market.
The recent changes in trade policies and economic outlook have created a mix of challenges and opportunities for investors. While there are uncertainties, the overall sentiment in the market remains positive with room for growth. With that in context, let’s take a look at the 12 stocks under $5 with biggest upside potential.
A close-up of a stock market ticker displaying the company’s stocks.
Our Methodology
To compile our list of the 12 stocks under $5 with biggest upside potential, we used Finviz and Yahoo stock screeners to find the 30 largest companies trading under $5 as of January 17. From that list, we narrowed our choices to the 12 stocks that analysts see the most upside to. We also included their stock price as of January 17 and their hedge fund sentiment, which was taken from Insider Monkey’s Hedge Fund database of 900 elite hedge funds as of Q3 of 2024. The list is sorted in ascending order of analysts’ average upside potential as of January 17.
Why do we care about what hedge funds do? 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
12 Stocks Under $5 With Biggest Upside Potential
12. Ultrapar Participações S.A. (NYSE:UGP)
Upside Potential: 67.04%
Stock Price as of January 17: $2.67
Number of Hedge Fund Investors: 10
Ultrapar Participações S.A. (NYSE:UGP) is a Brazilian conglomerate with diversified operations in fuel distribution, chemicals, and storage. The company’s primary business is Ipiranga, a major fuel distribution network, serving gas stations and industries. The company also operates Ultragaz, an LPG distributor company, Ultracargo, the leading bulk liquid storage provider in Brazil, and Oxiteno, a producer of specialty chemicals.
Ultrapar Participações S.A. (NYSE:UGP) is investing in new energy sources and technologies to diversify its portfolio and reduce its dependence on traditional fuels. Ultragaz, the LPG distributor, is expected to contribute significantly to the company’s growth, with a focus on expanding its customer base and increasing its share of new energy sources, such as biomethane and electricity. The company is also exploring opportunities to leverage its logistics and storage capabilities to support the growth of its energy businesses. For example, Ultracargo is developing new terminals and expanding its storage capacity to meet the growing demand for fuel and other energy products.
Ultrapar Participações S.A. (NYSE:UGP) is also investing in its Texaco brand, which is expected to contribute to the company’s expansion in the Brazilian market. The company is also exploring opportunities to support the development of Hidrovias do Brasil, a company in which Ultrapar Participações S.A. (NYSE:UGP) has a stake, and is working to expand its logistics and storage capabilities to support the growth of its energy businesses.
11. Globalstar, Inc. (NYSEAMERICAN:GSAT)
Upside Potential: 76.19%
Stock Price as of January 17: $1.89
Number of Hedge Fund Investors: 17
Globalstar, Inc. (NYSEAMERICAN:GSAT) is a satellite communications company that provides voice and data services through its global satellite network. The company has a strong foundation in mobile satellite services and generates revenue from device sales, service subscriptions, and IoT solutions.
Globalstar, Inc. (NYSEAMERICAN:GSAT) has recently announced a new deal with Apple, that includes the provision of a new network, in addition to the existing one, and the launch of new satellites. The company has established a special-purpose entity to hold the new network assets, which will be funded by a prepayment of $1.1 billion for infrastructure, Apple will also invest $400 million to acquire a 20% passive equity stake in the special-purpose entity. This deal is expected to generate significant revenue for Globalstar, Inc. (NYSEAMERICAN:GSAT), with revenues projected to more than double the company’s current annual run rate. The new satellites and network will also enable Globalstar, Inc. (NYSEAMERICAN:GSAT) to offer expanded mobile satellite services, including increased global MSS licensing, and will provide the company with a strong foundation for future growth.
Furthermore, Globalstar, Inc. (NYSEAMERICAN:GSAT) is investing in the development of new technologies and services. The company is currently in the alpha stage of testing a new system that has been under development and expects to progress to beta testing with key customers. The company is also expanding its XCOM RAN private network 5G access solution, a private wireless network technology designed for high-performance, flexible connectivity in applications such as warehouse automation and factory operations.
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.
9. Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI)
Upside Potential: 90.15%
Stock Price as of January 17: $4.77
Number of Hedge Fund Investors: 31
Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI) is a leading biotechnology company that provides a wide range of products and services, including mRNA synthesis, gene editing tools, and safety testing solutions for biopharmaceuticals. The company is dedicated to the development of next-generation medicines, with a particular focus on nucleic acid production (NAP) and biologics safety testing (BST).
Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI) is focusing on driving innovation and developing new products to meet the evolving needs of its customers. The company introduced 21 new products year to date and is expanding its offerings in mRNA synthesis and gene editing tools. Notably, the launch of the CleanScribe RNA Polymerase, a novel enzyme that significantly reduces double-stranded RNA formation during in vitro transcription, has been well-received by top pharmaceutical companies. This product not only enhances the safety and efficacy of mRNA therapeutics but also streamlines the production process, making it a valuable addition to the company’s portfolio. Additionally, the company is expanding its TriLink’s co-transcriptional capping technology with the issuance of new patents.
Additionally, Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI) has announced the acquisition of the DNA and RNA businesses of Officinae Bio. This acquisition is expected to bring advanced AI-driven digital platforms and automation solutions for large and complex DNA assembly and mRNA synthesis, which will complement the company’s existing offerings. The acquisition will also enhance the company’s ability to provide end-to-end services from sequence to drug product. Furthermore, Maravai LifeSciences Holdings, Inc. (NASDAQ:MRVI) is leveraging its research collaborations with nine top-tier academic institutions, including the University of California, San Diego, to accelerate the adoption of the latest technologies and drive long-term value creation.
8. Getty Images Holdings, Inc. (NYSE:GETY)
Upside Potential: 104.00%
Stock Price as of January 17: $2.75
Number of Hedge Fund Investors: 4
Getty Images Holdings, Inc. (NYSE:GETY) is a global provider of premium visual content and services, offering a vast collection of high-quality images, videos, and other media assets to businesses, media organizations, and creative professionals worldwide. The company serves a diverse range of industries including advertising, media, entertainment, and corporate communications. The company operates through three main brands: Getty Images, iStock, and Unsplash+, each catering to different segments of the market.
Getty Images Holdings, Inc. (NYSE:GETY) has made significant strides in growing its subscription business, which accounted for more than 50% of its total revenue in Q3. The company has seen 9 consecutive quarters of high-double-digit growth in annual subscriber count, adding 96,000 active annual subscribers to reach 298,000, a 48% increase over the comparable LTM period. This growth is driven by the success of its e-commerce offerings, particularly iStock and Unsplash+. These platforms have been instrumental in attracting new customers from targeted growth markets in EMEA, APAC, and the Americas, contributing to the company’s geographic expansion strategy.
Getty Images Holdings, Inc. (NYSE:GETY) is now focusing on cross-selling its Custom Content offering, where brands such as Citi, Mitsubishi Motors, HSBC, Asahi, and 3M have trusted the company to produce product and brand-specific content. These custom Content projects not only generate significant revenue but also deepen customer relationships and open new opportunities for upselling and cross-selling. Additionally, the company is leveraging its unique historical archive to create commercials for global brands, such as Prime Video. Furthermore, Getty Images Holdings, Inc. (NYSE:GETY) has partnered with Sony Pictures on an activation for the Venom series, to fine-tune its high-quality generative AI model to support the Venomize My Pet promotional campaign.
7. NovaGold Resources Inc. (NYSEAMERICAN:NG)
Upside Potential: 116.46%
Stock Price as of January 17: $3.28
Number of Hedge Fund Investors: 13
NovaGold Resources Inc. (NYSEAMERICAN:NG) is a leading gold exploration and development company with a primary focus on the Donlin Gold Project in Alaska, which is one of the largest and highest-grade undeveloped gold deposits in the world. The company operates this project in partnership with Barrick Gold and aims to establish a profitable mining operation.
NovaGold Resources Inc. (NYSEAMERICAN:NG) is actively advancing the Donlin Gold Project through a series of strategic initiatives aimed at optimizing the project’s development and maximizing its long-term value. One of the key areas of focus is the ongoing update of the resource model, which is nearing completion and will provide a more accurate and detailed understanding of the project’s potential. Another critical aspect of the project’s advancement is the Dam Safety certification, a mandatory requirement for the construction and operation of the tailings dam and related water retention structures. NovaGold Resources Inc. (NYSEAMERICAN:NG) has submitted the majority of the preliminary design packages to the Alaska Department of Natural Resources and anticipates receiving feedback and approval in the coming months.
Additionally, NovaGold Resources Inc. (NYSEAMERICAN:NG) has made significant progress in metallurgical testing at a pilot plant in Ontario, Canada, aimed at validating optimizations to the flow sheet. This work is expected to provide valuable insights that will guide the project’s future development.
6. IHS Holding Limited (NYSE:IHS)
Upside Potential: 125.86%
Stock Price as of January 17: $3.21
Number of Hedge Fund Investors: 14
IHS Holding Limited (NYSE:IHS) is an independent tower company in Africa that provides critical infrastructure and services to the telecommunications industry. The company operates a vast network of over 39,000 towers across multiple countries, including Nigeria, South Africa, and other key markets in Sub-Saharan Africa, Latin America, and the Middle East and North Africa (MENA) region.
IHS Holding Limited (NYSE:IHS) is concentrating on renewing and extending long-term contracts with major telecom operators. The company recently achieved a significant milestone by renewing and extending all tower contracts with MTN Nigeria through 2032. This agreement encompasses nearly 13,500 tenancies and approximately 23,800 lease amendments and ensures stable and predictable revenue streams. Furthermore, IHS Holding Limited (NYSE:IHS) has extended all six of its MTN country Master Lease Agreements (MLAs) into the next decade, covering over 70% of its Group revenue. These renewals not only bolster financial stability but also mitigate risks associated with power prices and foreign exchange fluctuations.
IHS Holding Limited (NYSE:IHS) remains committed to improving financial performance through disciplined cost control and capital expenditure (CapEx) optimization. Furthermore, the company is also leveraging artificial intelligence (AI) and advanced technologies to streamline operations and reduce costs. These efforts aim to enhance profitability and drive increased adjusted levered free cash flow.
5. Denison Mines Corp. (NYSEAMERICAN:DNN)
Upside Potential: 128.72%
Stock Price as of January 17: $1.88
Number of Hedge Fund Investors: 23
Denison Mines Corp. (NYSEAMERICAN:DNN) is a leading uranium exploration and development company focusing on the Athabasca Basin in Northern Saskatchewan, Canada. The company’s Wheeler River Project, which includes the high-grade Phoenix deposit, is a world-class resource that is expected to reach production by 2027 or 2028. Denison Mines Corp. (NYSEAMERICAN:DNN) also holds a 22.5% interest in the McClean Lake Joint Venture, which includes the McClean Lake uranium mill, and a diverse portfolio of exploration properties.
Denison Mines Corp. (NYSEAMERICAN:DNN) is actively working to advance the Phoenix deposit, a key component of the Wheeler River Project, towards production. The company has identified Phoenix as a unique opportunity due to its potential to achieve industry-leading cost efficiency. Initial capital costs to develop the deposit are expected to have one of the lowest capital intensities in the uranium sector, making it particularly attractive from an economic standpoint. Denison Mines Corp. (NYSEAMERICAN:DNN) plans to employ an in-situ recovery (ISR) method for mining Phoenix, a technique known for its cost-effectiveness and minimal environmental footprint compared to conventional mining methods. The company estimates that this approach will result in all-in production costs of approximately $16 per pound of uranium. Moreover, the project’s strategic location near existing infrastructure enhances the feasibility and economic appeal of the project.
In addition to Phoenix, Denison Mines Corp. (NYSEAMERICAN:DNN) is exploring ways to optimize the potential of the Gryphon deposit, another significant asset within the Wheeler River Project. Unlike Phoenix, which will utilize ISR technology, Gryphon is expected to be developed using conventional underground mining methods. This deposit represents a substantial addition to the project’s overall reserves, with an estimated 49.7 million pounds of proven U3O8.
4. EVgo, Inc. (NASDAQ:EVGO)
Upside Potential: 132.26%
Stock Price as of January 17: $3.41
Number of Hedge Fund Investors: 17
EVgo, Inc. (NASDAQ:EVGO) is a leader in electric vehicle (EV) charging infrastructure. The company operates a robust network of direct current (DC) fast charging stations across 40 states, making it one of the most extensive and reliable charging networks in the country.
EVgo, Inc. (NASDAQ:EVGO) is concentrating on growing its network of public EV charging stations to meet the rising demand for reliable infrastructure. The company aims to triple its charging network by 2029 and has recently secured a $1.25 billion guaranteed loan from the U.S. Department of Energy (DOE) under the Title 17 Clean Energy Financing Program. This low-cost financing will facilitate the development of approximately 7,500 new public fast-charging stalls nationwide and will increase the company’s total owned and operated stations to at least 10,000 by 2029.
EVgo, Inc. (NASDAQ:EVGO) is also collaborating with major automotive manufacturers, notably General Motors. Together, EVgo, Inc. (NASDAQ:EVGO) and General Motors are building 2,850 DC fast charging stalls, including 400 flagship stalls at key urban destinations across the U.S. These flagship locations will feature up to 20 or more stalls, equipped with advanced 350-kilowatt chargers, pull-through access, canopies, enhanced lighting, and security cameras.
Furthermore, EVgo, Inc. (NASDAQ:EVGO) in partnership with Delta Electronics is co-developing cutting-edge 400-kilowatt fast chargers, slated for deployment in late 2026. This advanced charging technology is expected to enhance user experience and lower capital expenditures (CAPEX) by approximately 30%.
3. Geron Corporation (NASDAQ:GERN)
Upside Potential: 163.32%
Stock Price as of January 17: $2.89
Number of Hedge Fund Investors: 29
Geron Corporation (NASDAQ:GERN) is a biopharmaceutical company dedicated to developing and commercializing innovative therapies, including telomerase inhibitors for hematologic malignancies (blood cancers). Geron Corporation (NASDAQ:GERN) recently achieved a major milestone with the FDA approval and commercial launch of RYTELO, a first-in-class telomerase inhibitor for treating lower-risk myelodysplastic syndromes (MDS).
Geron Corporation (NASDAQ:GERN) is focusing on the commercialization of RYTELO in the U.S. The company is working to broaden its reach by targeting more eligible patients and enhancing awareness among healthcare providers (HCPs) through educational programs and market research. Additionally, Geron Corporation (NASDAQ:GERN) is preparing for the potential European Union launch of RYTELO. The European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) is currently reviewing the marketing authorization application, with completion anticipated by early 2025. Subject to approval, the company plans to launch RYTELO in select EU markets starting in 2026. To support this expansion, Geron Corporation (NASDAQ:GERN) is partnering with experienced third parties to manage key activities, including reimbursement, health technology assessments (HTA), market access, and distribution.
Geron Corporation (NASDAQ:GERN) is also advancing the pivotal Phase 3 IMpactMF trial for relapsed/refractory myelofibrosis (MF). Interim and final analyses are expected in 2026 and 2027, respectively. A successful outcome from this trial could significantly expand RYTELO’s market potential and establish its position as a transformative treatment for hematologic malignancies.
2. OPKO Health, Inc. (NASDAQ:OPK)
Upside Potential: 169.39%
Stock Price as of January 17: $1.47
Number of Hedge Fund Investors: 22
OPKO Health, Inc. (NASDAQ:OPK) is a diversified healthcare company engaged in the development and commercialization of diagnostics, pharmaceuticals, and healthcare services. The company focuses on areas such as cancer, metabolic disorders, infectious diseases, and women’s health. OPKO Health, Inc. (NASDAQ:OPK) markets products such as Rayaldee, which is used to treat secondary hyperparathyroidism in adults with chronic kidney disease, and Somatrogon (marketed as NGENLA), a human growth hormone injection developed in partnership with Pfizer.
OPKO Health, Inc. (NASDAQ:OPK) is making progress with its oxyntomodulin analog, OPK-88006, which has shown promise in preclinical studies as a potential once-weekly injectable treatment for patients with obesity or metabolic disorders. The company is also collaborating with Entera Bio to develop an oral version of OPK-88006, which could offer a competitive edge in the marketplace.
Additionally, OPKO Health, Inc. (NASDAQ:OPK) is actively exploring partnerships and business development opportunities to foster growth and create value across its divisions. The company has also partnered with Merck to develop an Epstein-Barr virus multivalent nanoparticle vaccine, which is anticipated to enter clinical trials in the coming months.
1. ImmunityBio, Inc. (NASDAQ:IBRX)
Upside Potential: 314.63%
Stock Price as of January 17: $2.94
Number of Hedge Fund Investors: 8
ImmunityBio, Inc. (NASDAQ:IBRX) is a clinical-stage immunotherapy company developing treatments for cancer and infectious diseases. The company combines cell therapy, immunomodulators, and vaccine technology to enhance the immune system’s ability to fight diseases.
ImmunityBio, Inc. (NASDAQ:IBRX) is focusing on the successful commercialization of its flagship product Anktiva (nogapendekin alfa), an interleukin-15 receptor superagonist, that was approved by the FDA in April 2024 for the treatment of bladder cancer in combination with BCG (Bacillus Calmette-Guérin). The company has implemented a comprehensive commercialization strategy for Anktiva, focusing on building a strong sales and marketing team, establishing a reliable distribution network, and implementing patient support programs to ensure that Anktiva is accessible to patients and healthcare providers.
Additionally, ImmunityBio, Inc. (NASDAQ:IBRX) is expanding Anktiva’s market in other bladder and lung cancers along with other solid tumors. The company is preparing to submit a supplemental application in the United States to extend the drug’s approval to include patients with papillary bladder cancer, a broader patient population than the currently approved indication. ImmunityBio, Inc. (NASDAQ:IBRX) is also expanding its market reach by pursuing approvals in other regions such as Europe and the UK.
While we acknowledge the potential of ImmunityBio, Inc. (NASDAQ:IBRX) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than IBRX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
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