About to Buy Penny Stocks? Look at These 3 Companies First

Penny stocks, which usually means stocks issued by small companies that trade for less than $5 per share, often attract speculative investors who have been given promises of big returns within a short time. After all, a low-priced stock only needs to rise by a dollar to generate double-digit percentage gains.

But penny stocks are cheap for some pretty obvious reasons. Some of these stocks previously plummeted due to serious fundamental problems, while others only trade on over-the-counter exchanges, which aren't subject to the tighter regulations of the NYSE or Nasdaq. Most penny stocks aren't much better than lottery tickets, or some of the "meme stocks" that recently caught on fire on Reddit.

Instead of chasing penny stocks, let's examine three growth stocks that offer better opportunities for investors who can stomach some near-term volatility: Pinterest (NYSE: PINS), Datadog (NASDAQ: DDOG), and Peloton Interactive (NASDAQ: PTON).

Source Fool.com