When you find a penny stock that exhibits the following characteristics, you may have uncovered an investment that will grow in value for the coming months and years:
Growing market share in an expanding market.
The shares represent compelling value at current levels compared to other stocks in their peer group when based on financial valuation ratios, such as price-to-earnings or price-to-sales.
Approaching profitability through a combination of growing revenues and expense reductions.
A management team that has had great successes with previous businesses.
Solid intellectual property (patents, trademarks, and copyrights) that ensures survival against the much bigger players in the space.
High product acceptance among customers, which results in very low customer attrition.
Effective marketing, which is not only profitable but also accentuates the brand.
Indications, through technical analysis, of higher near-term prices based on money flows, share price momentum, and buying indicators such as moving averages.
