The Most Successful Penny Stocks in History and What You Can Learn

Penny stocks have a reputation for being high-risk investments, but some have yielded incredible returns. Take the case of Tesla, which started as a penny stock in 2010 with a price of just $1.09.

Investors who got in early on Tesla made a fortune as the company's stock skyrocketed to over $700 in 2020. This is a prime example of the potential for penny stocks to deliver life-changing gains.

The key to success in penny stocks is often timing and research. You need to find companies on the cusp of significant growth or innovation, like Tesla's electric car revolution.

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Penny stocks have some of the highest historical stock market returns, with some companies experiencing returns exceeding 150,000%. This is because they often carry more risk, but the potential upside can be significant.

The name "penny stock" comes from the fact that these stocks trade for pennies, but anything under $5 can be considered a penny stock. These stocks are typically found in new companies or niche industries.

Some penny stocks have gone ballistic in the past, like GameStop in 2021, which was one of the biggest stories of the year. Dogecoin and SPAC stock CCIV also had a big run-up in 2021.

To spot stocks with potential, it's essential to understand what they've already done and study their patterns. This can help you come up with a plan for the next big gainer.

February 2021 was a good time for many stocks, but it's crucial to remember that past performance is not a reliable indicator of future results.

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GameStop Corp. (GME) is a notable penny stock that experienced a surge in 2021, with its stock returns increasing from $2.57 to $291.51, a staggering 11,342.80% gain.

This was largely due to a push by Reddit users, who took positions against institutional short sellers, causing the stock to skyrocket.

One of the biggest winners from the GameStop surge was Keith Gill, who made almost $8 million.

GameStop's stock returns were not limited to a single day, as CFD traders and spread betters who positioned in late January 2021 saw the biggest returns, reaching 1,239.43%.

Netflix is another notable penny stock that has gone big in the past. It started as a DVD company that couldn't get funding from Blockbuster but has since become the largest online streaming platform in the world.

With over 220 million subscribers and annual revenue topping $29 billion, Netflix's average stock market return over the last decade is an impressive 54,840%.

Short-term traders who traded between the 23rd and 30th May 2021 had a 496.71% gain.

Here are some key statistics on these notable penny stocks:

Axsome Therapeutics Inc. was once a lowly penny stock that traded under $10 until the spring of '19. It's now traded on the NASDAQ.

Axsome reached $101.98 in December of '19 and now trades at $40. This biotech develops novel therapies for central nervous system conditions.

It's rare for a penny stock to turn into a billion-dollar company, but studying how it happened can be helpful.

Workhorse Group Inc is a technology company that provides high-performance electric vehicles and aircraft to commercial transportation operators. The company's stock price has been quite volatile, jumping from the low single digits to a 2021 high of $42.96 before crashing back down to current levels.

One of the main reasons for this volatility is the company's failure to secure a hoped-for contract with the United Postal Service. This setback was a major blow to the company's stock price, which has since struggled to regain its momentum.

Despite this setback, Workhorse Group's stock is still considered a success story, particularly in the context of its history as a penny stock. In fact, the company's stock traded as low as $1.88 over the last 52 weeks, but it currently sits at a price almost seven times as high.

Here's a comparison of Workhorse Group's stock price over time:

Keep in mind that the company's stock price can be quite unpredictable, and it's essential to do your research and stay up-to-date on the latest news and developments before making any investment decisions.

It's every penny stock trader's dream to find that golden ticket. Every once in a while, a lowly penny stock turns into a billion-dollar company.

The best thing we can do after the fact is study how it happened.

Companies like Amazon and Google started as small ventures, with Amazon initially selling books online and Google beginning as a research project at Stanford University.

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Pier 1 Imports (PIR) is a great example of a company that started small. It traded at 11 cents in the spring of '09. This tiny price tag is a far cry from the over $20 per share it soared to as the economy emerged from the Great Recession.

Penny stocks have a reputation for being high-risk, high-reward investments. The history of penny stocks is filled with examples of companies that have gone from pennies to billions.

One notable example is Tesla, which started trading at $0.31 per share in 2010. It's now one of the most valuable companies in the world.

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The success of Tesla is a testament to the potential of penny stocks to make investors rich. However, it's essential to do your research and understand the risks involved.

In the early 2000s, companies like Amazon and Google were also trading as penny stocks. Amazon started at $18 per share in 1997 and Google at $85 per share in 2004.

These companies' early success stories demonstrate the potential for penny stocks to become major players in the market.

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