In this article, we will look at the 8 Cheap Penny Stocks to Buy Right Now. Let’s look at where Lument Finance Trust, Inc. (LFT) stands against other cheap penny stocks.
The economy of the United States has stabilized, with inflation continuously cooling down and the risk of recession overruled. The Federal Reserve cut interest rates on September 18, slashing them by half a point as a start to its first easing cycle in four years. The Federal Reserve statement said:
“The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance.”
However, Fed Chair Jerome Powell announced on September 30 that the recent aggressive half-percentage point interest rate cuts should not be interpreted as a sign that future rate cuts would also be as aggressive. Instead, they are likely to be smaller. Talking to the National Association for Business Economics, he said:
“Looking forward, if the economy evolves broadly as expected, policy will move over time toward a more neutral stance. But we are not on any preset course. The risks are two-sided, and we will continue to make our decisions meeting by meeting.”
Powell expressed confidence in the country’s economic strength, claiming that inflation is expected to continue cooling. He also indicated that if the economic data shows consistency in the coming days, two more rate cuts would likely materialize in 2024. These, however, are expected to come in smaller quarter percentage point increments. This trend goes against market expectations for more aggressive cuts and easing.
During a Q&A session after his speech in Nashville, Tennessee, he said that:
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“This is not a committee that feels like it’s in a hurry to cut rates quickly. If the economy performs as expected, that would mean two more rate cuts this year, a total of 50 [basis points] more.”
Sustainable Growth Expected in Small Caps Amidst Market Shifts
On July 26, Nathan Moser, Managing Director and Senior Portfolio Manager at Impax Asset Management, discussed some long-term possibilities for small-cap stocks on Schwab Network. Talking about the recent changes in small stocks, he discussed the positive shift and noted that the recent rise in small caps appears more sustainable after years of struggle. This trend is primarily driven by strong inflows into ETFs and passive investment vehicles.
Despite short-term volatility, Mooser believes the market’s current move could last for years. He thus encouraged buying on market dips, while highlighting the need to focus on profitable, high-quality companies due to the potential risks typically associated with lower-quality stocks in small caps.
Our Methodology
We first consulted stock screeners from Finviz and Yahoo Finance to create an initial list of 15 publicly traded penny stocks with forward P/E ratios of less than 15 as of October 1, 2024. From this list, we selected the 8 stocks with the highest number of hedge funds holders as of Q2 2024, and used that as our ranking metric. The stocks we identified are profitable, have positive EPS growth, and are expected to remain profitable in the future as well.
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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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
8 Cheap Penny Stocks to Buy Right Now
8 Cheap Penny Stocks to Buy Right Now
Lument Finance Trust, Inc. (NYSE:LFT)
Share Price: $2.52
Forward P/E: 6.33
EPS Growth This Year: 53.80%
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Number of Hedge Fund Holders: 5
Lument Finance Trust (NYSE:LFT) is a real estate investment trust that invests in, originates, finances, and manages a commercial real estate debt investment portfolio. Its primary focus is transitional floating-rate CRE mortgage loans while emphasizing middle-market multifamily assets. It also invests in other CRE-related investments, including preferred equity, mezzanine loans, commercial mortgage-backed securities, construction loans, fixed-rate loans, and other CRE debt instruments.
The company’s mortgage loan investment portfolio comprises around 88 senior secured floating rate loans with around $1.4 billion in aggregate unpaid principal balance. Lument Investment Management, LLC externally manages the company. Lument Finance Trust (NYSE:LFT) holds a competitive advantage due to its expertise in the origination, underwriting, and active asset management of multifamily mortgage investments. It also boasts strong sponsorships from the broader Lument and ORIX platforms, positioning it as a value proposition in today’s public markets. Despite the current challenging environment, the company raised its common dividend by $0.01 in June. This represents a 14% sequential increase over Q1.
It also fully deployed its capital into strong, predominantly multifamily credits by the end of 2023. Since then, it has focused on actively managing its loan investment portfolio.
The company has differentiated itself from its market peers by focusing on middle-market multifamily credit, allowing it to deliver a stable and sustainable dividend to its shareholders and preserve shareholder capital. According to the company, multifamily, particularly middle-market multifamily, is expected to remain a strong-performing asset class in the long term despite a modest softening of multifamily fundamentals.
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Lument Finance (NYSE:LFT) continually maintains a strong liquidity position, with around $65 million in unrestricted cash on its balance sheet. Persistent elevated short-term rates have allowed the company to produce attractive returns on its cash balance. Intentionally adopting a defensive cash position, Lument Finance (NYSE:LFT) has gained the flexibility to manage the more challenging credits in its portfolio.
Overall, LFT ranks sixth among the 8 cheap penny stocks to buy right now. While we acknowledge the potential of LFT as an investment, 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 LFT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
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Disclosure: None. This article is originally published at Insider Monkey.
Baker McKenzie today announced that leading project finance lawyer Matthias Schemuth has joined the Firm’s Singapore office* as a Principal and Asia Pacific Co-Head of Projects in its Finance & Projects practice, alongside Partner Jon Ornolffson in Tokyo.
Matthias joins the Firm from DLA Piper, bringing more than 20 years of experience in the energy and infrastructure sectors across Asia Pacific. He advises sponsors, developers, commercial banks, multilateral lending agencies, and export credit agencies on the structuring and financing of large-scale projects. His practice also spans international banking, structured commodity and trade finance, with a strong focus on emerging markets. Matthias has been consistently recognised by Chambers Asia Pacific and Who’s Who Legal as a leading project finance practitioner.
James Huang, Managing Principal of Baker McKenzie Wong & Leow in Singapore, said: “We are excited to welcome Matthias to our team. His expertise and proven record in managing teams will be invaluable as we expand our regional and global finance offerings for clients.”
Emmanuel Hadjidakis, Asia Pacific Chair of Baker McKenzie’s Banking & Finance Practice, commented: “Asia Pacific is seeing strong momentum in infrastructure development, energy transition investments, and cross-border project financing, much of it centred in Singapore. Having Matthias on board will further enhance our ability to help clients seize opportunities in the region’s evolving energy and infrastructure markets.”
Steven Sieker, Baker McKenzie’s Asia Chief Executive, added: “Matthias’s appointment underscores Baker McKenzie’s continued commitment to investing in exceptional talent across key markets to support our clients in navigating today’s increasingly complex business and regulatory environment.”
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Matthias said: “I’m thrilled to join Baker McKenzie and contribute to its strong growth in Asia Pacific. The Firm’s global reach and local depth provide an unparalleled platform for delivering innovative projects and financing solutions to clients in this dynamic region.”
With more than 2,700 deal practitioners in more than 40 jurisdictions, Baker McKenzie is a transactional powerhouse. The Firm excels in complex, cross-border transactions; over 65% of our deals are multijurisdictional. The teams are a hybrid of ‘local’ and ‘global’, combining money-market sophistication with local excellence. The Firm’s Banking & Finance lawyers are ranked in more jurisdictions than any other firm by Chambers.
Matthias’s hire continues the expansion of Baker McKenzie’s global team. His joining follows the recent arrivals of Carole Turcotte in Toronto; Tom Oslovar in Palo Alto; Jenny Liu in New York and Palo Alto; Helen Johnson, Mark Thompson, Nick Benson, Kevin Heverin, James Wyatt and Michal Berkner in London; Jan Schubert in Frankfurt; Todd Beauchamp and Charles Weinstein in Washington DC; Dan Ouyang, Winfield Lau, and Ke (Ronnie) Li in Beijing, Shanghai, and Hong Kong; and Alexander Stathopoulos in Singapore.
*Baker McKenzie Wong & Leow is the member firm of Baker McKenzie in Singapore
The Federal Reserve gave investors an early Christmas present by lowering interest rates by 25 basis points (i.e., 0.25%) marking its third rate cut this year. In the past, a change like this in the “long end” of the interest rate yield curve has triggered a predictable, investable pattern. Typically, this pattern would be bearish for finance stocks, particularly banks—investors would buy bank stocks when rates rose and sell them as rates fell….
Dozens of protesters from the “Religious Zionist Reservists Forum” and the “Shared Service Forum” demonstrated Saturday evening outside the home of Finance Minister Bezalel Smotrich in Kedumim.
The protesters arrived with a direct and pointed message, centered on a symbolic “draft order,” calling on Smotrich to “enlist” on behalf of the State of Israel and oppose what they termed the “sham law” being advanced by MK Boaz Bismuth and the Knesset’s haredi parties.
Among the protesters in Kedumim were the parents of Sergeant First Class (res.) Amichai Oster, who fell in battle in Gaza. Amichai grew up in Karnei Shomron and studied at the Shavei Hevron yeshiva.
Protesters held signs reading: “Smotrich, enlist for us,” along with the symbolic “draft order,” calling on him to “enlist for the sake of the State’s security and to save the people’s army – stand against the bill proposed by Bismuth and the haredim!”
Parallel demonstrations were held outside the homes of MK Ohad Tal in Efrat and MK Michal Woldiger in Givat Shmuel.
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Representatives of the “Shared Service Forum” said: “We are members of the public that contributes the most, and we came here to say: Bezalel, without enlistment there will be no victory and no security. Do not abandon our values for the sake of the coalition. The exemption law is a strategic threat, and you bear the responsibility to stop it and lead a real, fair draft plan for a country in which we are all partners. It’s in your hands.”
