The conventional wisdom is that we’re on the cusp of another major stock market rally. 2020 has been a volatile year, with the unprecedented ‘coronavirus recession’ in February and March, followed by a bull run through the summer and fall, with increased volatility in late autumn, as investors tried to make sense of the elections and the ‘second wave’ of the virus.But that’s all in the past. The election is settled, Congress will be split so narrowly that major legislative initiatives are unlikely, and the long-awaited COVID vaccines are starting to enter circulation. In short, we have a combination of risk and reward setting up, for investors willing to put some skin in the game. And for those who are truly ready to shoulder the extra risk, penny stocks can be the right choice for a major rally. These stocks are priced low, under $5 per share, and low prices usually happen for a good reason. But some penny stocks are fundamentally sound, and with their low price already baked in, they have nowhere to go but up. Using the TipRanks database, we’ve pulled up details on two compelling stocks that fit this profile of low share price and huge upside potential, 200% or more, according to Wall Street analysts. Not to mention, both boast a “Strong Buy” consensus rating.Palatin Technologies (PTN)We’ll start with Palatin Technologies, a biopharmaceutical company with a unique niche and a competitive advantage. Palatin specializes in the development of melanocortin and natriuretic peptide receptor systems. These are a new class of potential medications, receptor-specific and highly targeted toward specific diseases. Palatin has drugs in development for dry eye disease, obesity, and congestive heart failure. Palatin’s pipeline has more immediate applications, as well – PL8177, originally developed to target ulcerative colitis, has recently entered Phase 1 trials as a treatment for COVID-19.For the competitive advantage, Palatin has Vyleesi. Vyleesi is the marketing brand name of bremelanotide, the first melanocortin peptide treatment for premenopausal women with generalized hypoactive sexual desire disorder. The FDA considers Vyleesi a ‘first in class’ medication, and approved it for use in June 2019. Palatin has been marketing Vyleesi in North America since then. In July of this year, Palatin settled a legal dispute with AMAG Pharmaceutical, in which Palatin regained all North American legal rights to Vyleesi, along with a $16.3 million settlement, of which $12 million has already been paid. Currently going for $0.42 apiece, Canaccord analyst John Newman thinks that the share price presents an attractive entry point.”Vyleesi continues to make commercial progress, securing broader insurance reimbursement coverage and strengthening relationships with healthcare providers […] Palatin continues to look for potential US re-licensing for Vyleesi to enhance commercialization. Possible re-licensing/partnership could revolve around a company currently in the female healthcare products market. We believe a new re-licensing agreement could carry a meaningful upfront payment, given that Vyleesi has full FDA approval,” the 5-star analyst opined.On top of this, Palatin announced Phase 2 data from its PL9643 dry eye disease (DED) exploratory study last week. Newman points out that the results “showed statistically significant improvement in multiple signs and symptoms in the moderate to severe patient population.” Palatin plans to initiate phase 2/3 trials in mid-2021.In line with his bullish stance, Newman rates PTN a Buy, and his $3 price target implies room for a whooping 615% upside potential in the next 12 months. (To watch Newman’s track record, click here)Overall, Palatin gets a Strong Buy rating from the analyst consensus, and that verdict is unanimous, based on 3 recent Buy reviews. The average price target, $2.17, implies an impressive 417% upside for the coming year. (See PTN stock analysis on TipRanks)Mustang Bio (MBIO)Mustang Bio is another clinical phase biopharmaceutical company. Mustang’s focus is on potential cures for blood cancers, solid tumors, and genetic diseases, using medical breakthroughs in cell and gene therapies to create targeted medications. The company is actively developing CAR-T (Chimeric antigen receptor T cells) therapies as treatments for non-Hodgkin’s Leukemia and other cancers.Mustang has a robust research pipeline, with gene therapies, hematologic CAR-Ts, and solid tumor CAR-Ts in development to treat a wide range of diseases. Pre-clinical research is ongoing, and Phase 1 and 2 trials are planned through 2023. The company has six clinical trials ongoing, for conditions ranging from glioblastomas to multiple myeloma to prostate cancer. The company’s clinical stage drug, MB-106, is showing promise as a treatment for non-Hodgkin’s Leukemia.In his detailed review of the company for B. Riley Securities, analyst Justin Zelin notes the early success of MB-106, and its potential for the company going forward.“We view MB-106’s robust efficacy of 89% overall response rate (ORR) and 44% complete response rate (CRR) and an extremely favorable safety profile in n=9 NHL patients treated with Mustang’s modified cell manufacturing process as a significantly positive de-risking event for the program and Mustang’s platform overall. On the heels of this positive data-set, Mustang will file an Investigational New Drug (IND) application in 1Q21E to enable the initiation of a multi-arm multicenter Phase II study of MB-106, providing a de-risked registrational pathway to approval in CD20+ NHL patients,” Zelin wrote.At the bottom line, Zelin is bullish on Mustang, writing, “We continue to believe Mustang Bio is undervalued relative to peers due to a historical lack of catalysts and clinical data, which is now changing with positive clinical data presentations.”Zelin’s comments back up his Buy rating, and his $13 price target indicates room for up to 300% growth next year. (To watch Zelin’s track record, click here)Mustang is another penny stock with a unanimous Strong Buy rating, this one based on 4 recent Buy reviews. The company’s shares are selling for $3.16 and have an average price target of $10.75, suggesting an upside 235% on the one-year time frame. (See MBIO stock analysis on TipRanks)To find good ideas for penny stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.