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TheStreet Open House

Top 10 Penny Stocks of 2010

NEW YORK ( TheStreet) -- The Great Recession produced a slew of penny stocks for speculative investors, with many stock prices falling below the $3 per share threshold during the throes of the bear market.

For a handful of penny stocks, the returns have been massive over the first six months of the year.

TheStreet found the top 10 penny stocks performers of 2010, ranked by total returns, and we offer a look at what may be in store for investors in those companies for the remainder of the year.

10. LGL Group (LGL) is an electronic components manufacturer based in Orlando, Fla. The stock finished 2009 at $3.29, around where it traded for most of the year after falling more than 75% in 2008.

Closing Price: $13.24 (June 16)

Total Return (YTD): 302.4%

Developments in 2010: LGL Group shares have returned to pre-recession levels, trading recently at a 52-week high of $14.20. In March, LGL Group posted a fourth-quarter profit of 15 cents a share, swinging from a year-ago loss of 5 cents a share. For an encore, LGL said in May that it had a first-quarter profit of 47 cents a share, swinging from a year-ago loss of 46 cents a share.

Valuation: Like SMTC, LGL Group has seen volume pick up in 2010 as the stock has surged. And much like SMTC, the company offers investors an attractive price-to-sales ratio of 0.87. That compares to its peer group average of 11.38. However, a price-to-book ratio of 2.98 is nearly twice the average of the electronic and electrical equipment sector, according to Bloomberg.

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