Will These Penny Stocks Stay Below $2?
Penny stocks are always considered high-risk, high-reward equities. But many investors still have a hard time with the standard definition of penny stocks. According to the Securities and Exchange Commission, penny stocks are shares of public companies trading below $5. I know it might sound confusing because usually, such a simple name would suggest the definition is in the phrase. But it’s something that has been put in place for certain reasons.
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It also allows me to write about a lot more companies so selfishly, I’m ok with it. Regardless, when you talk to someone who’s a purist, then the definition of penny stocks may involve stocks below $1. Ideally, the term “penny” would suggest stocks trading for pennies.
So, stocks under $1 are favored among many high-volatility traders. Before I get into this list of penny stocks under $1, where do you stand on the topic? Personally, what’s your definition of a penny stock? Is it limited to stocks under $1 or do you go by the standard SEC definition of penny stocks under $5?
With this in mind, let’s take a closer look at a few penny stocks right now. They’ve all begun trending for different reasons. The biggest questions are will they remain penny stocks under $1 for long or will they slide back this month?
Penny Stocks To Buy Under $1: JC Penney
Talk about a “true penny stock”. While the name has an extra “e” in it, the company founded by James Cash Penney, J.C. Penney (JCP Stock Report) has been fighting an uphill battle for years. Burdened by debt and slow foot-traffic, the retailer has been trying to find a path toward success.
Late last year, it started thinking outside the box with a consignment opportunity. But by the time February 2020 rolled around, COVID-19 really made sure to halt all progress. Mall closures and failure to evolve into a meaningful online retailer, JC Penney has suffered a big blow. But recent attention has be placed on how it will advance. The company recently entered into talks with lenders and it appeared a bankruptcy filing was imminent.
J.C. Penney Co. on Friday said it has made the roughly $17 million interest payment on its senior secured term loan credit facility that was due May 7, averting a default as the struggling retailer continues to explore its options. In a filing, J.C. Penney said it made an interest payment on Thursday after using the grace period of five business days to evaluate certain strategic alternatives. J.C. Penney has been reported to be in advanced talks with bank lenders for a bankruptcy loan as large as $1 billion to carry it through a potential chapter 11 process.
According to the Wall Street Journal, J.C. Penney’s creditors may enter a forbearance agreement to allow additional time to negotiate with lenders before filing. This update was seen as a positive for JCP stock on Friday. Shares jumped during the regular session. Keep in mind, it’s just filed for bankruptcy so it could be a very “interesting” open to the week next week. Is this just a glimmer of “hopium” for the market or can JCP stock really begin to turn around?
Penny Stocks To Buy Under $1: Ritter Pharmaceuticals
Ritter Pharmaceuticals (RTTR Stock Report) has been one of the top penny stocks to watch in May 2020. While we’ve discussed this company off and on since November, RTTR stock held a brighter spotlight this month. A lot of the anticipation has been building around the company’s proposed merger deal.
This deal is related to the Company’s proposed with Qualigen, Inc. The merged company will focus on the development of Qualigen’s nanotechnology therapies for the treatment of cancer and infectious diseases, while also continuing to operate its revenue-generating diagnostic business.
This week the company announced adjournment of its Special Meeting on May 14th regarding the merger proposal. It was originally scheduled for today, until Monday, May 18, 2020 at 12:00 p.m., Pacific Time. Ritter said that the special meeting was adjourned to “allow the Company additional time to solicit proxies in favor of the proposals to be acted on by stockholders at the meeting”.
After a few days of ups and downs, RTTR stock saw another green day of trading in May. Since the start of the quarter, shares have climbed 150% from $0.30 to highs of $0.75 and closed the week above $0.60. Will RTTR stock continue this trend if it can obtain final approval of this merger? Better question, do you think the merger itself will actually gain approval? Comment with your thoughts.
Penny Stocks To Buy Under $1: Seelos Therapeutics
Somewhat of a “sleeper” this quarter, Seelos Therapeutics (SEEL Stock Report) saw its second, “big day” of trading on May 15. Shares reached highs of $0.99 before the end of the day with more than 7.3 million shares traded. The last time SEEL stock rallied like this was on April 30. At the time, the company just announced it was granted Orphan Drug Designation for its SLS-005 in Sanfilippo syndrome from U.S. FDA. Never heard of SEEL? You might be among the many traders scanning for higher-volume penny stocks.
While, SEEL stock actively trades, it doesn’t nearly trade as many shares as some of the top penny stocks we’ve seen recently. That is, until May 15. SEEL broke out after the company’s latest announcement. It cam earlier in the day and again mid-morning. First, the company announced that it has been granted Rare Pediatric Disease Designation for SLS-005 in Sanfilippo syndrome from the U.S. FDA.
The Rare Pediatric Disease Designation is an incentive program to encourage new therapies for preventing and treating rare pediatric diseases. Under the designation, the FDA awards priority-review vouchers to drug makers upon approval of drugs to treat rare pediatric diseases. Those vouchers can be used to obtain a priority review for another drug or sold to other companies
Later in the session, Seelos announced the appointment of F. Hoffman-La Roche alum, Judith Dunn to its Board. Clearly, the previous news related to its RPDD program turned heads on Friday. Will that momentum continue next week or is another “one and done” trading session for SEEL stock?
Penny Stocks To Buy Under $1.50: iBio Inc.
Once again, iBio Inc. (IBIO Stock Report) is back on the list of penny stocks to watch right now. While it isn’t one of the stocks under $1, it does still fall under $1.50 (for now). Yesterday we continued to cover progress being made with the company. iBio has gained a lot of attention among traders looking for trending coronavirus penny stocks.
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May has been relatively sparse as far as announcements go. But at the end of April, iBio provided an update on its COVID-19 vaccine manufacturing capacity. The company announced that it joined the National Institute for Innovation in Manufacturing Biopharmaceuticals. Surely the news from Sorrento Therapeutics (SRNE Stock Report), which we caught in real time this morning, had an impact on COVID stocks.
While, IBIO stock could have been considered one of the penny stocks under $1 earlier this week, shares close just a hair shy of $1.50 on Friday. But as we explained yesterday, the company recently raised about $1 million with Lincoln Park Capital Fund. That 8K was filed on May 14th and while money for the furtherance of operations is important, so is the price per share it was raised at. Accordingly, iBio’s deal shows it raised the money at $1.09/share. Will this shake up the market or has this already been baked in?