Trading in penny stocks can be highly rewarding for investors if the stock makes a big move. Considering the fact that those stocks trade below $5 anyway, by definition, the returns could be quite handsome.
However, it is also true that you can also make significant losses if you choose the wrong stocks. Hence it is important to choose penny stocks which have fundamentally sound businesses. In such a situation, it is perhaps better for any investor to prepare a list of penny stocks that they would like to keep an eye on. For instance, here are three penny stocks that investors were eyeing earlier this week
Penny Stock #1 Neovasc
Neovasc Inc (NVCN Stock Report), a Canada based medical device manufacturer, was on a tear on Tuesday. This move came after a document surfaced in which the company’s application for a patent with the US Patent and Trademark Office was contained.
The patent abstract describes a device that is supposed to help in loading prosthesis into a delivery system. NVCN stock surged by 8.50% to $0.515 on Tuesday. The patent abstract is still only a description and the approval process is often a long drawn out one.
Penny Stock #2 Chico’s FAS
Another stock that soared on Tuesday was the clothing company Chico’s FAS (CHS Stock Report). We discussed this in our first article about CHS Stock. The company reported strong earnings in Q1 2019. Although the earnings per share dropped from 23 cents to 5 cents per share year on year, it managed to beat analysts’ estimates. The estimates came in at 3 cents earning per share and that was possibly the trigger behind the rise. The net income dropped year on year to $2.03 million from $29 million.
However, the revenues of $517 million for the quarter missed analysts’ estimates of $518.3 million. It also reflected a significant year on year drop. Although the stock rose by 8% on Tuesday, the company has projected revenue growth only in the single-digit range.
Penny Stock #3 Sesen Bio
The last penny stock in focus for the week is Sesen Bio (SESN Stock Report), a company that is involved in developing targeted fusion protein therapeutics for people suffering from late stage cancer. On Monday, the company announced that it was successful in completing a Type B Pre-Biologics License Application for its product Vicinium.
It is meant for the treatment of non-muscle invasive bladder cancer that is unresponsive to Bacillus Calmette-Guérin. The company has also managed to get an Accelerated Review Pathway with the U.S. Food and Drug Administration in addition to a Rolling Review. This was a significant breakthrough for the company and the stock soared by as much as 8% Tuesday’s session after the news broke.