Which stocks are either a fan favorite or a must-avoid? Penny stocks. These tickers going for less than $5 apiece are particularly divisive on Wall Street, with those in favor as well as the naysayers laying out strong arguments.
These names are too appealing for the risk-tolerant investor to ignore. Given the low prices, you get more for your money. On top of this, even minor share price appreciation can translate to massive percentage gains, and thus, major returns for investors.
However, there is a but here. The critics point out that there could be a reason for the bargain price tag, whether it be poor fundamentals or overpowering headwinds.
Based on the above, weeding out the long-term underperformers from the penny stocks going for gold can pose a significant challenge. In this case, the activity of legendary stock pickers can provide some inspiration.
Enter billionaire Steven…
