Before diving into the discussion about the most promising penny stocks to buy in May, a caveat is in order: when you enter this arena, you must be prepared to lose money. Sure, it’s always possible to make serious dough. But chances are, you’re going to lose. Never lose sight of this risk factor. Nevertheless, the best penny stocks for May will attract even conservative investors because of their powerful upside potential. Moreover, every idea on this list features a consensus of analysts (even if that is a consensus of one) supporting the upside proposition. Now, that’s not a guarantee of anything, let me be crystal clear. However, if you’re already intent on speculating, these penny stock winners in May offer a solid starting point.

Super Group (SGHC)

Billed as a global digital gaming company, Super Group (NYSE:SGHC) aims to provide first-class entertainment to the worldwide betting and gaming community. While priced under $4 at the time of writing, SGHC doesn’t rate as one of your typical ideas for the most promising penny stocks to buy in May. In particular, it carries a market capitalization of $1.92 billion.

Since the start of the year, SGHC gained nearly 23% of its equity value. Better yet, the surge isn’t fundamentally unjustified. In particular, Super Group benefits from a strong balance sheet. Its cash-to-debt ratio comes in at 13.8, ranked above 84.5% of sector players. Operationally, its three-year revenue growth rate stands at 36.7%, above 95.85% of rivals. Therefore, it makes a strong case for the best penny stocks for May.

Finally, Wall Street analysts peg SGHC as a consensus moderate buy. Their average price target comes out to $5, implying almost 30% upside potential.

RLX Technology (RLX)

Based in China, RLX Technology (NYSE:RLX) is a leading branded e-vapor (or e-cigarette) business. Like it or not, several “analog” smokers have transitioned to the digital alternative. As a result, the vaping subsegment of the broader adult liberties category commands a rising demand profile. Still, RLX – despite being a candidate for the most promising penny stocks to buy in May – slipped nearly 4% since the start of the year.

Still, like Super Group above, RLX is not your typical speculative idea. Featuring a market cap of $3.72 billion, the company enjoys a very strong balance sheet. For example, its cash-to-debt ratio stands at 125.55, above 85.42% of companies listed in the tobacco products industry. Also, its Altman Z-Score hits 19.77, implying extremely low bankruptcy risk. Notably, RLX features a trailing-year net margin of 27.41%, beating out 91.67% of its peers.

Lastly, Citigroup’s Lydia Ling pegs RLX a buy. The expert forecasts a price target of $3.15, implying nearly 33% upside potential.

B2Gold (BTG)

Ranking among the most promising penny stocks to buy in May because of underlying gold sector enthusiasm, mining enterprise B2Gold (NYSEAMERICAN:BTG) deserves to be on your radar. Priced at under five bucks, BTG represents a solid performer, returning 15% to shareholders since the Jan. opener. Over the past 365 days, it gained over 3%.

Financially, B2Gold carries a balanced profile, especially for a gold miner. Its Altman Z-Score hits 7, indicating high fiscal stability and low bankruptcy risk. On the balance sheet, its debt-to-equity ratio sits at 0.02, ranked better than 82.14% of its peers. Operationally, B2Gold’s three-year revenue growth rate pings at 13.9%, above 62.8% of companies listed in the metals and mining industry. As well, its book growth rate during the same period is 14.3%, above 68.17%.

To close out, analysts peg BTG as a consensus strong buy. On average, their price target hits $6.10, implying nearly 44% upside potential.

Denison Mines (DNN)

Another mining enterprise, Denison Mines (NYSEAMERICAN:DNN) focuses on another valuable asset class, uranium. Although somewhat controversial for exploring and developing and producing uranium projects, the commodity represents a critical cog in the broader energy discussion. Further, if geopolitical instability continues, more nations will likely turn to nuclear-based solutions. That should help lift DNN as one of the most promising penny stocks to buy in May.

Priced at only a few cents higher than a buck, DNN carries an understandably worrying proposition. However, it does own some key positives, including a robust balance sheet. Its cash-to-debt ratio is 102.32, above 73.6% of its peers. Also, its Altman Z-Score hits 6.58, indicating high stability and low bankruptcy risk.

To be sure, its operational stats suffered. For instance, its three-year revenue growth rate sits at 8.4% below zero. Nevertheless, analysts believe DNN represents one of the penny stock winners in May. Most recently, TD Securities’ Craig Hutchinson pegs DNN a buy with a price target of $1.68. This estimate implies upside potential of nearly 49%.

VTEX (VTEX)

Billed as a highly flexible and low-maintenance platform, VTEX (NYSE:VTEX) specializes in improving efficiencies for its enterprise-level clients’ e-commerce business units. At the moment, VTEX carries a market cap of $699.27 million. Since the beginning of this year, shares slipped nearly 6%. In the past 365 days, they’re down slightly over 20%. Still, it could rank as one of the most promising penny stocks to buy in May.

For starters, VTEX enjoys a robust balance sheet. Notably, its cash-to-debt ratio pings at 35.14, above 76.48% of companies listed in the software industry. Also, its Altman Z-Score hits 5.37, indicating high stability and low risk of imminent bankruptcy. Operationally, VTEX benefits from a three-year revenue growth rate of 36.2%, above 89.28% of its peers. Also, VTEX might be undervalued, with shares priced at only 2.87 times tangible book value.

In contrast, the sector median stat is 3.69 times. Interestingly, analysts believe VTEX is among the penny stock picks for May. They peg shares a unanimous strong buy with a $5.63 price target, implying over 52% upside potential.

Zomedica (ZOM)

Getting into the literal examples of the most promising penny stocks to buy in May, Zomedica (NYSEAMERICAN:ZOM) shares trade hands for only 22 cents a pop. Right now, the animal health and veterinary equipment specialist carries a market cap of nearly $212 million. Since the start of this year, ZOM returned stakeholders 37% of the market value. In the past 365 days, it’s up almost 10%.

While these stats might sound encouraging, you should note that in the past five years, ZOM hemorrhaged 89% of value. Therefore, contrarians here will require an abundance of caution. Still, its financials don’t seem too horrible. For instance, Zomedica enjoys a cash-to-debt ratio of 66.22, above 85% of companies listed in the drug manufacturing industry. Now, to be sure, Zomedica suffers from deeply negative operating and net margins. Therefore, ZOM represents an aspirational idea.

Still, if you’re looking for high-growth penny stock opportunities in May, ZOM could be intriguing. Dawson James’ Jason Kolbert believes shares will hit 44 cents, implying over 100% upside potential.

Superior Drillings Products (SDPI)

Another literal idea among the most promising penny stocks to buy in May, shares of Superior Drillings Products (NYSEAMERICAN:SDPI) trade hands for a few pennies shy of a buck as of this writing. For some, that might be the green light for speculation. Since the Jan. opener, SDPI gained over 3%. In the trailing one-year period, it slipped 5%.

Fundamentally, though, the oil and gas industry equipment provider could swing higher if hydrocarbon energy prices rise. Currently, the sector suffers from a lull. However, some geopolitical rumblings – particularly another surprise oil production cut – could spark sector-specific inflation.

Cynically, SDPI investors will probably be hoping for such an outcome as Superior Drillings’ financials remain mixed. It posts okay profitability stats but its three-year revenue growth rate sits at 4.2% below zero. Still, EF Hutton’s Ignacio Bernaldez pegs SDPI a buy with a $2 price target, implying over 108% upside potential.

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Read More: Penny Stocks — How to Profit Without Getting Scammed

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.