Penny stocks tempt investors with the promise of sky-high returns, while often delivering disappointing results. These companies typically don't have the same disclosure requirements that other publicly traded companies do -- which keep investors in the dark -- and their prices can fluctuate very quickly and leave their investors reeling

Of course, no investment is guaranteed to make you money. But you're far better off buying stocks in great companies and holding them for the long haul, rather than trying to time the market with sketchy companies you hardly know anything about. To help you track down a few stable investments, we reached out to a few Motley Fool investors for some stock recommendations. Here's why they think Osisko Gold Royalties (NYSE:OR), Cirrus Logic (NASDAQ:CRUS), and Square (NYSE:SQ) are better investments than penny stocks.

A pile of pennies with a stack of pennies on top.

Image source: Getty Images.

A big step up from a penny gold stock

Reuben Gregg Brewer (Osisko Gold Royalties Ltd.): Mining companies are a mainstay of the penny stock universe. But there's a lot of risk involved when you invest in a miner that, in penny stock land, often has just a single undeveloped project underpinning its business. That's why you should look at Osisko Gold Royalties, a streaming and royalty company that's a bit more aggressive than its larger peers.

Streaming companies make money by providing cash up front to miners for the right to buy gold and silver in the future at contractually guaranteed low prices. Very often, miners use the money to build new mines. Osisko has 130 streaming deals, but only 20 are currently generating cash flow. The others are in some earlier stage of development.   

However, that's not the full picture. About 75% of management's time is dedicated to its streaming business with the rest dedicated to direct investments in mining companies. It holds stakes in four mining companies. The company calls this segment its accelerator business, as it attempts to help miners build new projects by directly financing the mining companies.   

Osisko's direct investments exposes it to the ups and downs of the mining business that streaming is meant to avoid. However, this exposure can also provide additional upside if management makes the right investment choices. Offsetting the risk, meanwhile, is the more conservative streaming portfolio. Streaming-focused, and more diversified, peers like Royal Gold and Franco-Nevada are a better call if you are risk-averse. But for more aggressive types, Osisko's dual approach is worth a closer look.

A small-cap chip play

Ashraf Eassa (Cirrus Logic): Instead of buying a risky penny stock, you might want to check out shares of audio-chip maker Cirrus Logic. Cirrus Logic generates most of its revenue from selling audio chips to Apple (NASDAQ:AAPL) in support of the iPhone, iPad, and other devices, so it's a stock that carries with it some very real concentration risk.

Nevertheless, with the shares trading near a 52-week low thanks to weaker-than-expected chip sales to Apple (unsurprising, as demand for its current iPhone portfolio has fallen short of expectations), I think it could be a good time for more risk-tolerant investors to consider picking up some shares of the chip company.

CRUS Chart

CRUS data by YCharts.

If the upcoming iPhone product cycle proves robust (and I think the rumored iPhone lineup looks substantially more compelling than the current one is), then that could act as a source of positive earnings surprises for stockholders.

Moreover, a recent report from analysts at Susquehanna claims that Cirrus Logic will be providing chips that perform noise cancellation for Apple's next-generation AirPods line of wireless earbuds. That win coupled with the potential for other wireless earbud makers to try to follow suit could be an interesting source of revenue growth in the coming years.

Cirrus Logic isn't the safest stock in the world -- after all, it's a small-cap chip stock with high exposure to a single demanding customer with a taste for vertical integration -- but given that the stock is trading near 52-week lows with multiple potential catalysts coming up, I'd much rather own Cirrus Logic shares than any penny stock.

Hip to be square

Chris Neiger (Square): If you're chasing after huge returns, consider that over the past three years, shares of Square have surged about 380%. There's no guarantee they'll continue climbing, of course, but the company is making some solid moves that indicate Square should keep growing.

Square has its hands in a number of different payment and management services for businesses of all sizes. The company's hardware and software allow business to swipe credit cards and accept wireless payments (you've likely seen their bright white payment terminals that connect to iPads), but Square also has lending services, a food delivery business, payroll and inventory management, and can even help business build websites. In short, the company has built itself into the place for businesses to get their own businesses up and running.

Investors have been optimistic about this company because of Square's ongoing growth. In the most recent quarter, Square's revenue jumped by 45% year over year, and its gross payment volume (GPV) -- the dollar amount of all transactions processed through its platform -- increased by 31% to $17.8 billion.

Aside from the company's organic growth, Square recently purchased the website-building company Weebly, which will bring Square 625,000 paid subscribers. Not only that, but 40% of Weebly's customers are outside of the U.S., which helps Square grow its international footprint as well.

Investors should know that Square is still firmly in growth mode and isn't profitable right now, but the company's continual opportunities from its payment services, website building, and other services are all moving this company in the right direction. If Square's sales and GPV keep growing, then it's only a matter of time before profits begin to materialize.