Analyst Thinks This $3 Stock Has 92% Upside Potential

We recently started a series called “Penny Stock of the Day”. These ideas are geared towards traders with an extremely high risk appetite.

Our Penny Stock of the Day is chosen by screening for stocks under $5 and then applying technical analysis on the shortlisted set of penny stocks showing unusual volume. When making these trades, please make sure to pay vigilant attention to pricing moves and have a strict stop loss in place to avoid significant losses.

Penny Stock of the Day: New Found Gold Corp. (NYSE: NFGC)

Today’s penny stock pick is the mineral exploration company, New Found Gold Corp. (NYSE: NFGC).

New Found Gold Corp. engages in the identification, evaluation, acquisition, and exploration of mineral properties in the Provinces of Newfoundland and Labrador, Canada. The company primarily explores for gold deposit. It holds 100% interests in the Queensway project that includes 103 mineral licenses and 7,024 claims covering an area of 175,600 hectares located near Gander, Newfoundland; the Kingsway project located in Gander, Newfoundland; and the Mustang Property consisting of 3 mineral licenses. The company was formerly known as Palisade Resources Corp. and changed its name to New Found Gold Corp. in June 2017.

Website:  https://newfoundgold.ca/

Latest 10-k report:  https://wp-newfoundgold-2025.s3.ca-central-1.amazonaws.com/media/2025/07/20250321_NFG_FY2024_Form-40-F_EDGAR-Filed.pdf

Analyst Consensus: As per TipRanks Analytics, based on 1 Wall Street analyst offering 12-month price targets for NFGC in the last 3 months, the stock has an average price target of $5.00, which is nearly 92% upside from current levels.

Potential Catalysts / Reasons for the Hype:

• The company’s strategic acquisition of Maritime Resources in September 2025 positions NFGC as a near-term gold producer with access to two mills and immediate free cash flow generation.
• Corporate Insiders placed Informative Buys of Shares Worth $14.3M in the Last 3 Months.
  

  Insiders | Source: TipRanks.com

• Broader sector tailwinds, such as record gold prices and anticipated strong Q3 earnings for gold miners could benefit NFGC amid rising commodity demand.

On analyzing the company’s stock charts, there seem to be multiple bullish indications…

Bullish Indications

#1 Uptrend Channel: The daily chart shows that the stock looks poised for a breakout from an uptrend channel, which is shown as purple color lines. This is a possible bullish indication.

#2 Bullish ADX and DI: The ADX indicator shows bullishness as the +DI line is above the -DI line, and the ADX line is currently moving higher from below the +DI and -DI lines.

#3 Price above MAs: The stock is currently above its 50-day as well as 200-day SMA, indicating that the bulls have currently gained control.

#4 Bullish Aroon: The value of Aroon Up (orange line) is above 70 while Aroon Down (blue line) is below 30. This indicates bullishness.

#5 Above Support Area: The weekly chart shows that the stock is currently trading above a support area, which is marked as a pink dotted line. This looks like a good area for the stock to move higher. The stock is also trading above its 50-week SMA, indicating that the bulls are gaining control.

#6 MACD above Signal Line: In the weekly chart, the MACD (light blue color) is currently above the MACD signal line (orange color). This indicates a possible bullish setup.

Recommended Trade (based on the charts)

Buy Levels: If you want to get in on this trade, the ideal buy level for NFGC is above the price of $2.65.

Target Prices: Our first target is $3.90. If it closes above that level, the second target price is $5.00.

Stop Loss: To limit risk, place a stop loss at $1.90. Note that the stop loss is on a closing basis.

Our target potential upside is 47% to 89%.

For a risk of $0.75, our first target reward is $1.25, and the second target reward is $2.35. This is a nearly 1:2 and 1:3 risk-reward trade.

In other words, this trade offers 2x to 3x more potential upside than downside.

Potential Risks / Red Flags:

1. The company has a history of net losses.
   

   NFGC – Consolidated Statements of Operations

2. As a junior explorer-turned-producer, NFGC faces typical mining risks like exploration failures, regulatory hurdles in Newfoundland and Labrador, environmental concerns, and dependency on gold price stability.
3. The Company has a limited operating history and its mineral properties are exploration stage properties.
4. The company has a history of legal proceedings. NFGC had announced the settlement of a dispute with ThreeD Capital Inc. and 1313366 Ontario Inc., resolving a lawsuit concerning a November 2019 share sale. The settlement, which included the transfer of 3.75 million common shares of New Found Gold Corp. (NFG), was reached without any admission of liability from any party to avoid further litigation costs and uncertainties.
5. Despite being a loss-making company, the executives are being paid significant compensation.
   

   NFGC – Executive Compensation

As you can see, today’s featured penny stock offers big upside potential… but it also comes with a number of risks and red flags. As always, when dealing with penny stocks, we advise caution before entering into such high-risk ventures. Remember to think before you trade… understand the risks… and if you decide to trade, stick to your stop-losses!

Happy Trading!

Trades of the Day Research Team

READ BEFORE TRADING PENNY STOCKS: The allure of penny stocks lies in their potential to deliver massive gains in a short period of time. However, in exchange for that opportunity, most penny stocks carry tremendous risk. They can be extremely volatile and are susceptible to “pump and dump” schemes and fraud.

Unlike regular stocks, the financial condition of most penny stock companies can be extremely difficult to analyze, as the majority of such stocks are traded on over-the-counter (OTC) exchanges, which are typically less transparent and less regulated than the major exchanges. In fact, in the penny stock space, it’s often easier to spot warning signs and red flags than it is to identify a sound investment. Nevertheless, we do our best to identify short-term trade opportunities in this exciting space because we know some of our readers are looking for high-risk, high-reward ideas. We just urge you to make sure you fully understand the risks before making any of these trades.

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