Wall Street just wrapped up its worst session in a month, with the Dow, S&P 500, and Nasdaq all sliding on oil-driven inflation fears and a disappointing Big Tech earnings slate. But under the surface of that mega-cap carnage, a separate universe of sub-$5 stocks is trading on its own news flow — defense contracts, biotech data readouts, AI partnerships, and shareholder-friendly capital moves. Below are 10 penny stocks under $5 worth watching heading into Friday, July 24, 2026, each with the numbers, the catalyst, and the risk laid out plainly.

Why Penny Stocks Are Attracting Attention Right Now

• Small-cap and micro-cap names often move independently of macro headlines since their share prices react almost entirely to company-specific news rather than Fed policy or oil prices.
• Volume and volatility are elevated across the sub-$5 universe this week as traders rotate out of expensive AI mega-caps and into speculative, event-driven setups.
• Government and defense spending, FDA and clinical trial catalysts, and AI-adjacent partnerships are the three biggest themes driving movement in this list.

1. Richtech Robotics Inc. (NASDAQ: RR)

• Richtech Robotics received a Nasdaq notice for listing-rule non-compliance tied to a late filing, even as the company continues expanding its warehouse footprint with a newly acquired Las Vegas facility.
• The company is set to showcase new warehouse automation solutions, including an AI-driven Pallet Jack robot, at the Automate 2026 trade show in Chicago.
• Bull case: Richtech’s push across three strategic pillars — industrial, commercial, and hospitality robotics — positions it to benefit from broader enterprise AI-automation adoption, and shares have shown repeated support in the $3.40–$3.60 zone on the charts.
• Bear case: The stock carries deeply negative EBITDA margins (around -310%), and the pending Nasdaq compliance notice adds delisting-risk overhang until resolved.
• Forecast: Resolution of the Nasdaq filing issue, paired with any new contract news out of Automate 2026, are the catalysts most likely to move the stock next.

2. BigBear.ai Holdings, Inc. (NYSE: BBAI)

• Shareholders approved doubling BigBear.ai’s authorized share count to 1 billion shares at its 2026 annual meeting, giving management more flexibility for future capital raises or acquisitions.
• Backlog rose 14% even as the stock fell sharply over the past six months on profitability concerns.
• Bull case: HC Wainwright holds a Buy rating with a $6.00 target, and the company reports roughly $715 million in liquidity to fund its national security and supply-chain AI pipeline.
• Bear case: A securities fraud class action alleges accounting errors, and the doubled share count raises dilution concerns for existing holders.
• Forecast: Near-term direction likely hinges on whether backlog growth starts translating into narrower losses in the next quarterly print.

3. SurgePays, Inc. (NASDAQ: SURG)

• SurgePays gained after revising a wireless deal earlier this month, part of a broader push into its LinkUp distribution and subsidized wireless channels.
• The company’s AI decisioning platform is aimed at increasing revenue per subscriber across the subprime market it serves.
• Bull case: Revenue surged 292% year over year in a recent quarter to $18.7 million, with narrowing losses and improving margins.
• Bear case: Full-year 2025 revenue actually declined 6.44%, and losses, while shrinking, remain steep at over $36 million.
• Forecast: A sustained move toward the $5 analyst target would likely require another quarter of the subscriber and margin momentum management has been promising.

4. Can-Fite BioPharma Ltd. (NYSE American: CANF)

• Can-Fite’s Namodenoson pancreatic cancer data was accepted for presentation at ESMO 2026, adding a fresh conference catalyst to the calendar.
• The company’s Namodenoson drug hit its primary safety endpoint and showed durable survival outcomes in a Phase 2a pancreatic cancer trial, while its Piclidenoson psoriasis program completed a key Phase 3 enrollment milestone.
• Bull case: H.C. Wainwright raised its price target to $8 from $5 following the pancreatic cancer safety data, and Can-Fite also secured a new Australian patent covering Namodenoson.
• Bear case: The stock trades near the bottom of its 52-week range and below its 200-day moving average, and revenue remains minimal at roughly $405,000 for all of 2025.
• Forecast: The ESMO 2026 presentation is the catalyst to watch — clinical-stage biotechs like CANF can move sharply on conference data even without new trial results.

5. T Stamp Inc. (NASDAQ: IDAI)

• T Stamp, operating under its Trust Stamp brand, develops AI-driven biometric identity verification technology used across fintech, government, and healthcare use cases.
• Bull case: The identity-verification and fraud-prevention space continues to see budget growth as AI-driven fraud becomes a bigger enterprise risk.
• Bear case: As a thinly traded micro-cap, IDAI carries limited analyst coverage and can see outsized swings on light volume.
• Forecast: Watch for contract announcements or partnership news, which have historically been the biggest single-day movers for this name.

6. Milestone Scientific Inc. (NYSE American: MLSS)

• Milestone Scientific reported preliminary first-half 2026 revenue of roughly $5.0 million, up 9% year over year, with Q2 2026 revenue of about $2.8 million, up 21% year over year.
• The company continues to highlight growing clinical adoption of its CompuFlo pressure-guided injection system across epidural, neuromodulation, and interventional pain procedures.
• Bull case: Accelerating quarterly revenue growth and expanding physician adoption support the bullish thesis for this micro-cap medical device name.
• Bear case: The company remains unprofitable, and its market cap sits below $70 million, making the stock highly sensitive to any funding or dilution news.
• Forecast: Continued double-digit revenue growth in the back half of 2026 would likely be needed to sustain analyst optimism toward the $1.00–$1.25 target range.

7. Nano-X Imaging Ltd. (NASDAQ: NNOX)

• Nano-X Imaging’s Q1 2026 revenue came in at $4.31 million, short of the $4.54 million consensus, and the company withdrew its annual revenue guidance amid commercialization delays.
• The company signed a new commercial agreement with Howard Technology Solutions to support rollout of its FDA-cleared Nanox.ARC multisource imaging system.
• Bull case: The average analyst price target of $5.80 implies more than 360% upside from current levels, with the company targeting $35 million in 2026 revenue as deployments ramp in the second half.
• Bear case: A securities class action lawsuit is pending, with a lead plaintiff deadline of August 11, 2026, and cash burn continues to pressure the balance sheet.
• Forecast: The next earnings report, expected around August 18, 2026, should clarify whether second-half deployment guidance is achievable.

8. Rekor Systems, Inc. (NASDAQ: REKR)

• Rekor reported a preliminary Q2 2026 adjusted EBITDA loss of approximately $1.3 million, which management described as the point where its operational realignment became clearly visible in results.
• The company previously secured a $16.8 million contract with the Oklahoma District Attorneys Council for its UVED program and holds a newly granted patent protecting its AI-based vehicle recognition technology.
• Bull case: Rekor’s AI-powered traffic and public-safety software continues to win state-level government contracts, a durable and recurring revenue base.
• Bear case: The stock previously received a Nasdaq notice for bid-price non-compliance, and 2025 losses totaled more than $31 million against just $48.45 million in revenue.
• Forecast: Sustained improvement in adjusted EBITDA over the next two quarters would be the clearest signal that the turnaround story is real.

9. Genius Group Limited (NYSE American: GNS)

• Genius Group set July 31, 2026 as the record date for the second round of its Share Loyalty Bonus Program, offering a $0.10 cash bonus per qualifying share — equal to roughly 56% of the share price at last measure.
• The company reported unaudited Q2 2026 revenue of $3.2 million, up 112% year over year, with net profit from operations of $4.3 million versus a prior-year loss.
• Bull case: Genius Group has begun deploying capital from its planned $800 million AI Treasury initiative, including a $657,100 investment into pre-IPO exposure to Anthropic, SpaceX, and OpenAI via the Fundrise Innovation Fund.
• Bear case: A securities class action has been filed alleging investor harm, and the stock remains near its 52-week low despite the swing to operating profit.
• Forecast: The unusually large cash bonus program could act as a near-term support level for the shares into the July 31 record date.

10. SMX (Security Matters) Public Limited Company (NASDAQ: SMX)

• SMX has been expanding its cash position, reporting it lifted cash to $34.5 million in the first half of 2026 alongside a 181% increase in equity following a recent funding round.
• The company continues rolling out its Circularity-as-a-Service platform, positioning itself around state-level recycling mandates and the EU’s new fashion-waste ban that require verifiable proof of recycled material content.
• Bull case: Rising oil prices. Brent has pushed back above $100 a barrel this week. Increase the cost of virgin plastic, strengthening the economic case for SMX’s certified recycled-material verification technology.
• Bear case: SMX has undergone dual reverse stock splits in 2026 to maintain listing compliance. And the company filed to sell 25.41 million ordinary shares for holders, both signals of a stock structure under real dilution and going-concern pressure.
• Forecast: Watch for follow-through on state recycling-mandate announcements, which have been the company’s most consistent share-price catalyst this year.

Risk note: Several names in this space have already moved well above the $5 penny-stock threshold this month after single-day spikes of 100% or more. Sadot Group, for example, plunged as much as 72% intraday on July 8 following a short-seller report before closing at $18.62. A reminder of how violently these names can reverse in both directions. Always confirm a stock’s current price before treating it as a true sub-$5 name.

Sector Sentiment Snapshot

• Defense and government-linked penny stocks (RCAT, BBAI, REKR) are benefiting from the same Pentagon-spending tailwind lifting large-cap defense names like Lockheed Martin and RTX this week.
• Biotech and medtech names (CANF, MLSS, NNOX) are trading on conference catalysts and clinical data rather than macro sentiment. Making them relatively insulated from the broader market’s oil-and-rates-driven sell-off.
• Fintech and AI-education names (SURG, GNS, IDAI) are showing the widest dispersion, reflecting how thin float and low liquidity can amplify company-specific news into outsized single-day moves.

Forecast and What to Watch Next

• Volume confirmation matters most: For any of these names, a breakout on rising volume is a far stronger signal than a similar price move on light trading, given how easily thin penny-stock floats can be pushed by small dollar amounts.
• Dilution risk is elevated: With crude oil above $100 a barrel and Treasury yields at 52-week highs, cash-strapped micro-caps may increasingly turn to dilutive share offerings to fund operations. A risk worth monitoring across this entire list.
• Binary events ahead: CANF’s ESMO 2026 data, NNOX’s August 18 earnings, and GNS’s July 31 loyalty bonus record date are the clearest scheduled catalysts among this group over the next several weeks.

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Disclaimer: This publication is entirely for informational and journalistic purposes and does not constitute formal financial, investment, or legal advice. All market investments carry inherent risks of capital loss. Always complete independent due diligence prior to executing equity trades.

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Kasia Davis

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