TM Editors' note: This article discusses one or more penny stocks and/or microcaps. Such stocks are easily manipulated; do your own careful due diligence.  

Photo by Brett Jordan on Unsplash

If you are looking to invest in lesser-value artificial intelligence and intelligence-related (AI&R) stocks consider one of the few "penny" stocks that are trading for $5.00/share or less and also have market capitalizations of at least $50M. Below is a short list of 9 such stocks. None are being recommended, per se but, rather, are highlighted as possible opportunities to profit from the speculative frenzy in AI&R stocks. Access the stock symbols provided to do your own research.

Incidentally, a penny stock no longer refers to a stock trading for less than $1/share but, rather, it refers to the stock of a company that trades for less than $5 per share. Penny stocks are usually considered high-risk investments due to their low price, lack of liquidity, small market capitalization, and wide bid-ask spread. Most penny stocks trade via over-the-counter transactions hence a cautionary note from TalkMarkets that "penny and/or micro-cap stocks...are easily manipulated; do your own careful due diligence". 

The list below provides a profile of each penny stock, their current market capitalization, current stock price, earnings/share (if any), current short interest percentage, and stock return from their low during the last week of  April or first week of May until the end of July (i.e. almost 3 months) in descending order.

1. Ideanomics (IDEX): UP 300% since April 28th 
   • Sector: Industrials
   • Market Capitalization: $64M
   • AI Information: provides fintech services that include intelligent and innovative solutions powered by AI and blockchain
   • Stock Price: $0.08
   • Latest earnings/share: Negative
   • Short Interest: 10.5% - A high short interest signals that investors have become more bearish and may be getting ready to sell and, as such, that it may be time to liquidate a long position.
2. Rekor Systems (REKR): UP 149% 
   • Sector: Information Technology
   • Market Capitalization: $147M
   • AI Information: leverages AI, machine learning, and holistic data to support the intelligent infrastructure for transportation management, public safety, and urban mobility markets
   • Stock Price: $2.56
   • Latest earnings/share: Negative
   • Short Interest: 7.7%  
3. Knightscope (KSCP): UP 138%
   • Sector: Industrials
   • Market Capitalization: $82M
   • AI Information: is a security technology company that builds fully autonomous security robots that deter, detect and report
   • Stock Price: $1.45
   • Latest earnings/share: Negative
   • Short Interest: 10.5%
4. Innoviz Technologies (INVZ): UP 56% 
   • Sector: Information Technology
   • Market Capitalization: $427M
   • AI Information: designs and manufactures solid-state LiDAR sensors and develops perception software that enables the mass production of autonomous vehicles.
   • Stock Price: $3.39
   • Latest earnings/share: Negative
   • Short interest: 9.7%
5. Verses AI (VRSSF): UP 52%
   • Sector: Information Technology
   • Market Capitalization: $212M
   • AI Information: a cognitive computing company that develops network operating systems for enabling distributed intelligence and an AI assisted order picking solution
   • Stock Price: $1.55
   • Latest earnings/share: Negative
   • Short Interest: NA
6. Butterfly Networks (BFLY): UP 32% 
   • Sector: Health Care
   • Market Capitalization: $457M
   • AI Information: is reinventing itself based on generative AI to help it develop medical devices and deliver customer service
   • Stock Price: $$2.38
   • Latest earnings/share: Negative
   • Short Interest:16.0%
7. One Stop Systems (OSS): UP 15% 
   • Sector: Information Technology
   • Market Capitalization: $57M
   • AI Information: designs and manufactures innovative edge computing modules and systems for AI Transportable applications
   • Stock Price: $2.83
   • Latest earnings/share: $0.10; Latest price to earnings ratio of 29.3 
   • Short Interest: 0.5%
8. Veritone (VERI): UP 12%
   • Sector: Information Technology
   • Market Capitalization: $141M
   • AI Information: develops and operates an AI operating system that uses machine learning algorithms, AI models and human cognitive functions
   • Stock Price: $4.06
   • Latest earnings/share: Negative
   • Short Interest: 12.2%
9. SoundHound AI (SOUN): UP 6% 
   • Sector: Information Technology
   • Market Capitalization: $521M
   • AI Information:  develops independent voice AI platforms that enable businesses across industries to deliver high-quality conversational experiences to their customers
   • Stock Price: $2.29
   • Latest earnings/share: Negative
   • Short Interest: 10.2%

Summary

The average market capitalization of the above 9 stocks is $234M with an average stock price of $1.96. They are UP 43%, on average, since the end of April.

Conclusion

Given that the 11 stocks in the AI Bubble Portfolio (see here) are UP 79.3% since the end of April it suggests that there is an opportunity for considerable upside in the "Penny" AI Stocks Portfolio going forward. 8 of the 9 stocks currently have negative earnings per share so it will be interesting to see if their involvement with AI will result in any improvement in their bottom lines. We will report on their progress on a weekly basis.

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