Considering the broad market outlook, I believe it’s a good time to buy potential multibagger penny stocks with an investment horizon of 24 months. There is a strong case for multiple rate cuts in 2024 and potentially in 2025 to avoid a recession. This would imply that the financial markets will be flooded with liquidity. Penny stocks tend to perform well in this scenario.
However, I am not talking about the likes of GameStop (NYSE:GME) that skyrocketed during the meme stock euphoria. The rally fizzled out relatively soon. My focus is on penny stocks that represent companies with an attractive underlying business or asset that trade at a valuation gap.
Positive market sentiments coupled with business developments will ensure that these stocks surge higher. In my view, these are 5-bagger penny stocks and I expect these returns before the end of 2025.
This post originally appeared at InvestorPlace.