5 Best Penny Stocks To Invest In 2014

The Department of Commerce released its final figure for first-quarter GDP growth this morning, revising it downward from 2.4% to 1.8%. In a Reuters poll, economists' estimates called for the figure to remain unchanged. Nearly all components of GDP growth were revised downward, with the notable exceptions of housing and government. Consumer spending -- the largest component of GDP -- came in at 2.6% growth, down from 3.4%.

Despite this news, investors in the U.S. stock market continue to shake off their macro jitters this morning, with the S&P 500 (SNPINDEX: ^GSPC  ) and the narrower, price-weighted Dow Jones Industrial Average (DJINDICES: ^DJI  ) up 0.81% and 0.79%, respectively, at 10:05 a.m. EDT.

Fannie and Freddie: future uncertain
At the beginning of the month, I highlighted government mortgage agencies Federal National Mortgage Association (NASDAQOTCBB: FNMA  ) and Federal Home Loan Mortgage Corp. (NASDAQOTCBB: FMCC  ) , commonly known as Fannie Mae and Freddie Mac. As the result of an extraordinary run this year, the stocks now have, to my knowledge, the highest market capitalization of any penny stocks in the U.S. market.

Top 10 Information Technology Stocks To Watch For 2015: PostRock Energy Corporation(PSTR)

PostRock Energy Corporation, an integrated independent energy company, engages in the acquisition, exploration, development, production, and transportation of oil and natural gas in the United States. It operates in two segments, Oil and Gas Production, and Natural Gas Pipelines. The Oil and Gas Production segment primarily focuses on the development of coal bed methane in the Cherokee basin and the Marcellus Shale in Appalachian Basin, as well as has oil properties in Central Oklahoma. As of December 31, 2009, it had approximately 51.9 billion cubic feet equivalent (Bcfe) of estimated net proved reserves; development rights to approximately 516,184 net acres; and operated approximately 2,849 gross wells in the Cherokee Basin. It also had approximately 44,507 net acres of oil and natural gas producing properties with estimated proved reserves of 18.9 Bcfe and approximately 498 gross wells in Appalachian Basin; and had 65 gross wells, development rights to approximately 1,4 80 net acres, and estimated net proved reserves, 3.9 Bcfe in Central Oklahoma. The Natural Gas Pipelines segment involves in transporting, gathering, treating, and processing natural gas. It owns and operates a natural gas gathering pipeline networks of approximately 2,173 miles in the Cherokee Basin and 183 miles in the Appalachian Basin; and a 1,120 mile interstate natural gas pipeline, which transports natural gas from northern Oklahoma and western Kansas to the metropolitan Wichita and Kansas City markets. The company is headquartered in Oklahoma City, Oklahoma.

Advisors' Opinion:

• [By Eric Volkman]

  LeBlanc is a veteran energy industry CFO. He has filled that role at East Resources -- now a unit of Royal Dutch Shell (NYSE: RDS-A  ) -- as well as�PostRock Energy (NASDAQ: PSTR  ) , and Range Resources, among others.

5 Best Penny Stocks To Invest In 2014: ENSCO plc(ESV)

Ensco plc, together with its subsidiaries, provides offshore contract drilling services to the oil and gas industry. The company engages in the drilling of offshore oil and natural gas wells by providing its drilling rigs and crews under contracts with international, government-owned, and independent oil and gas companies. As of February 15, 2010, it owned and operated 42 jackup rigs, 4 ultra-deepwater semisubmersible rigs, and 1 barge rig. The company also has 4 ultra-deepwater semisubmersible rigs under construction. It operates in Asia, the Middle East, Australia, New Zealand, Europe, Africa, and North and South America. The company was formerly known as Ensco International plc and changed its name to Ensco plc in March 2010. Ensco plc was founded in 1975 and is based in London, the United Kingdom.

Advisors' Opinion:

• [By Ben Levisohn]

  As a result, Gerry cut Atwood Oceanics, Ensco (ESV) and Noble Energy (NE) to Market Perform from Outperform. He raised Rowan (RDC) to Outperform from Market Perform. Rowan was also a favorite of Barclays.

• [By Marc Bastow]

  Off-shore contact drilling service provider Ensco (ESV) raised its quarterly dividend 50% to 75 cents per share, payable on Dec. 20 to shareholders of record as of Dec. 9.
  ESV Dividend Yield: 4.90%
  

• [By Dan Burrows]

  The most interesting news out of T stock recently is that it�� slashing prices — again — as its price war with T-Mobile U.S. (TMUS) heats up. AT&T customers can sign up for a 2-gigabyte data plan for $65 per month, down from $80. And adding a second phone lifts the total to $90, down from $105. As much as the price war might help T’s market share, it doesn’t help the share price. T stock is down 8% so far this year.

  #5: Ensco (ESV)

  ESV Dividend Yield: 5.78%

5 Best Penny Stocks To Invest In 2014: HopFed Bancorp Inc.(HFBC)

HopFed Bancorp, Inc. operates as the holding company for Heritage Bank that provides various banking products and services primarily in western Kentucky, and middle and western Tennessee. The company offers a range of deposit products, including demand deposits, time deposits, money market accounts, passbook savings accounts, individual retirement accounts, and certificates of deposit. Its loan portfolio comprises one-to-four family residential loans, multifamily residential loans, construction loans, nonresidential loans, commercial real estate loans, and land and land development loans, as well as loans secured by deposits, other consumer loans, and commercial loans. The company, through its subsidiary, Fall and Fall Insurance Agency, sells life and casualty insurance products to individuals and businesses. HopFed Bancorp offers its products and services through its branch offices located in Hopkinsville, Murray, Cadiz, Elkton, Fulton, Calvert City, and Benton, Kentucky; and in Clarksville, Pleasant View, Ashland City, Kingston Springs, and Erin, Tennessee. The company was founded in 1879 and is headquartered in Hopkinsville, Kentucky.

Advisors' Opinion:

• [By Louis Navellier]

  HopFed Bancorp (HFBC), at $85 million in market cap, operates 18 branches in middle Tennessee and Western Kentucky and can be thought of as poster child for what is going on in the small banking sector. An activist investor took a stake in the bank and opposed an ill-advised acquisition. Instead, he suggested HopFed management get its own house in order. Management went along and canceled the deal, instituted a stock buyback plan and doubled the dividend. HFBC was upgraded to an “A” back in May and still is a “strong buy” right now.

5 Best Penny Stocks To Invest In 2014: Cornerstone Progressive Return Fund(CFP)

Cornerstone Progressive Return Fund is a closed-ended equity fund of fund launched and managed by Cornerstone Advisors, Inc. The fund invests funds investing in the public equity markets of the United States. It invests in stocks of companies operating across diversified sectors. Cornerstone Progressive Return Fund was formed on April 26, 2007 and is domiciled in the United States.

Advisors' Opinion:

• [By Dan Caplinger]

  But you can see in several places the consequences of the stampede toward high yield. Here are just a few:

  Closed-end funds Cornerstone Progressive (NYSEMKT: CFP  ) and Pimco High Income (NYSE: PHK  ) both make fixed payments back to fund shareholders on a monthly basis, and their distribution yields are truly extraordinary, at about 17% and 12%, respectively. Those dividends have enticed shareholders to pay $1.30 to $1.40 or more for each $1 of assets in the funds. Yet during most months, a substantial portion of those distribution payments has simply been a return of investor capital rather than true income from the funds' investments. A recent study discussed in The Wall Street Journal found that returns on a portfolio with a combined value and dividend-income strategy outperformed a strategy focused more exclusively on maximizing dividends by an average of 1.7 percentage points per year, a huge edge in long-run returns. In the dividend ETF arena, most funds tend to focus on maximizing yield. Although the popular Vanguard Dividend Appreciation (NYSEMKT: VIG  ) ETF bucks the trend by screening first for consistent dividend growth and only then looking at yield as a factor, many rival ETFs start with high-yielding stocks as their baseline and only then consider other desirable traits. Others focus solely on high-dividend niches of the market, such as iShares FTSE NAREIT Mortgage-Plus (NYSEMKT: REM  ) and its concentration on high-yield mortgage REITs.

  When dividend stocks get too popular, their prices get out of line with both their dividend income and the fundamentals of the businesses that underlie those stocks. In simpler terms, when dividend stocks become bad values, it's time to consider looking elsewhere for a margin of safety.