Earnings season has continued to captivate the market but so have global events. When you talk about things like penny stocks a few things might come to mind. Most of all, volatility is right at the top of the list. These cheap stocks are well-known for big swings.
Now, unless you’ve been hiding under a rock this year, you’ve seen how Tesla, for example, has attracted droves of investors. Why do you think that is? Did thousands of investors all of a sudden believe in Elon Musk’s vision for a Jetson’s-type future? My guess is that it was a bit vainer than that. When you see a stock gap up every day for weeks, heads start to turn. This is where the FOMO-factor comes into play. People see others making money, hand over fist because of such a move and they want their own piece.
This can be very dangerous for those who don’t understand the psychology of the market. But it happens. The difference is Tesla’s expensive. Two shares of the company’s stock cost more than $1,400 (for now). If you were to take that same $1,400 and put it into a stock like Takung Art, for example, back on January 2 and held on for the same amount of time as the Tesla move, your position would have jumped 428%. Now, I’m not suggesting that you buy either or sell either (if you hold shares).
But what I want to emphasize is the fact that volatility is one of the major driving forces behind making big money with stocks, no matter the price. It just so happens that big moves that Tesla just had are normal when you talk about penny stocks. This is why it might not be such a bad idea to have a list of penny stocks put together to capitalize on such moves.
Penny Stocks To Watch #1 Cemtrex
Cemtrex Inc. (CETX – Free Report) shares have been slowly ticking downward for weeks. But just when you think new lows are on the horizon, something big happens. This morning Cemtrex reported that it has developed a training application for luxury retailer, Cartier.
The novel approach to training is expected to be a more effective way of training employees. Whatever the case may become, the news has sent shares soaring. Though this may attract investors early on, keep in mind that this appears to be an update with no financial figures associated. Can it be enough to drive shares higher, still?
Penny Stocks To Watch #2 Aduro Biotech
Investors could also consider tracking Aduro Biotech (ADRO – Free Report). It has gained considerably over the past few weeks. Since the beginning of January, ADRO stock has jumped as much as 99% and has continued to gain this week.
Aduro has had to lay off many of its employees around 12 months ago, and in January, it announced that after weak results, it is going to cut back as much as 59% of its staff. The company’s headquarters in the Netherlands is also going to be axed by the third quarter this year. But streamlining operations may not be the only thing helping shares surge higher right now.
The analyst community has responded to Aduro’s latest adjustments as well. SVB Leerink raised its price target on the stock to $7. That’s up considerably from its previous target of $3. It further maintained its rating at “Outperform” for the stock. On Tuesday a 13G filing also showed new interest by the likes of Baillie Gifford & Co. The firm now holds over 5% of Aduro Biotech.
Penny Stocks To Watch #3 Tonix Pharmaceuticals
Another penny stock that has gained considerable momentum this week is that of Tonix Pharmaceuticals (TNXP – Free Report). Back in January, the company reported that it completed both dose proportion tests as well as fed-fasting tests. This was with regard to its product TNX 102 SL therapy.
Tonix went on to state that the results would be sufficient to clear the pharmacokinetic requirements meant for marketing the product in the US. If you’ve been a reader for a while on PennyStocks.com, Tonix has been one of the top penny stocks to watch since December. This month could be an important one for the company, especially after these results.
Tonix will present at several investor conferences including BIO CEO conference and Noble Capital’s conference. The company will also attend the Wall Street Conference Retreat on February 19. These upcoming conferences could be important to keep in mind especially if Tonix updates on new developments from its pipeline.
Penny Stocks To Watch #4 Chesapeake Energy
Chesapeake Energy (CHK – Free Report) hasn’t had the easiest time in the market. In fact, just a few days ago shares hit new 52 week lows of $0.505. It also doesn’t help that the company had one of its oil wells explode, which resulted in injuries and deaths in Texas.
But with the company’s updated production numbers out, investors could have some things to look forward to in the near term. That is, if the energy sector can uphold some sort of trend. The company expected oil production between 125,000 and 126,000 barrels of oil per day for Q4. It’s also anticipating upwards of 478,000 in equivalent production. Also, the debt structure for the company has become a lasting concern but hasn’t gone unnoticed by Chesapeake.
The company’s been able to eliminate roughly $900 million in debt while also restructuring existing debt that remains. In my opinion, as long as oil can recover, CHK stock will be one to watch. US Oil Fund (USO) has gotten absolutely demolished since the beginning of the year. As we’ve seen this week, it has slightly begun a recovery on Wednesday. Since CHK tends to move in close connection with USO, for example, sector-wide trends could direct this penny stock one way or another.
Penny Stocks To Watch #5 Nautilus
Finally, Nautilus (NLS – Free Report) has been one of the popular penny stocks to watch since early December. At the time we talked about how the holiday season could be a big driver for the company. Since then, NLS stock has managed to climb as high as $4.15 this year.
This week, shares of Nautilus started to rebound after the latest 2-week slide. On Wednesday shares rallied to morning highs of $3.37 from a previous close of $2.70. After the market close on February 4 the company reported a $70 million credit facility provided by Wells Fargo. I know you might be used to hearing about “family offices” handling financing but the fact that a bank like this took on this facility could bode well for the company.
It carries a 5-year term and will be used to refinance the company’s existing $40 million facility. What’s more, is that it’s asset-based compared to the traditional equity-based transaction we’re used to seeing with stocks trading below $4. Needless to say, with an essential new “lease on life,” it’s time for Nautilus to hit the ground running, no pun intended.