3 Low Float Penny Stocks Making New Highs Right Now
Low float penny stocks don’t have a standard definition. But for the purposes of this article, I would say that anything under 18 million shares can be considered a low float. If you’re new to penny stocks, you might be wondering how to find penny stocks with low floats. You can always look on financial websites for that type of info.
But sometimes the float data can be inaccurate. In this case, I would suggest looking at the OS or “Outstanding Shares”. In terms of share structure, a penny stock’s float will never be greater than its OS. So it’s probably a safe bet that if you’re looking for a low float, you can start with a low OS.
In addition, if you’re building a penny stock screener to find these stocks, some platforms won’t have options to choose float. Again, it’s a safe bet that setting a lower level OS will allow you to track low float penny stocks. Now, once you find these companies, you need to understand why a low float is important. The lower the float, the fewer the number of shares that are out in the open market. In cases of a little bit of above-average trading momentum, low float stocks can surge fast and furious. It’s simple supply and demand here.
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The lower the supply with higher demand will raise prices quickly. On the flip side, lower demand and higher supply will drop prices. In the case of low float penny stocks, the magnitude of these moves is magnified because of the generally low level of shares in the market. So keep that in mind if you’re looking to trade penny stocks like these.
Low Float Penny Stocks To Buy [or avoid]: Safe-T Group Ltd.
Outstanding Shares: 10.85M
Safe-T Group Ltd. (SFET Stock Report) has been one of the penny stocks to watch since March. At the time, SFET stock was trading around $1.55 and the company just announced it was offering 3 months free of remote access service for COVID-affected organizations across the world. Considering that the company is focused on cloud tech, there aren’t many options to get in on the coronavirus craze at the time so this route apparently was the direction chosen. Needless to say, SFET stock traded mostly sideways for the better part of the last 3 months.
There were sporadic jumps here and there after news updates. But there hasn’t been a lasting trend showing investors “this is in a bull market”. But at the end of June, could have have changed? SFET stock has ben slowly creeping up over the past few sessions. It initially began after Safe-T reported the launch of a unique implementation of its Zero-Trust Secure File Access Solution as Server Message Block (SMB) Proxy for Windows File Sharing. According to the company, the solution was chosen by a “leading intelligence unit,” after successfully winning a tender process. The gross amount of the purchase order came in at $225,000.
“These achievements are important milestones for us as they reiterate our mission to provide world class, innovative cyber security products which not only fit business and commercial needs but which we believe are also perfectly suited to government and defense requirements,” said Shachar Daniel, Safe-T Group’s CEO. Since then the penny stock has seen a bit more above average trading volume. Will this be one of the low float penny stocks to buy or avoid during the first week of July?
Low Float Penny Stocks To Buy [or avoid]: Sunworks Inc.
Outstanding Shares: 16.63M
Sunworks Inc. (SUNW Stock Report) is a relatively recent name on our lists of penny stocks. Last month we started following the company after it filed its proxy statement. The company called for a shareholder vote on several topics. One of these was to approve an amendment allowing it to reduce its authorized share count. Remember when I talked about the float never being larger than the OS? This is the same relationship that the OS has with the Authorized share (AS) count. OS will never be greater than AS.
The record date for the annual meeting was June 30, 2020. Since that filing, there hasn’t been much else from the company. Missed earnings and declining revenue has plagued the company. That’s in spite of Sunworks securing new projects along the way. The company has also been working to pay down debt. Is this a motion to show investors the company wants to consolidate shares in hopes of building more confidence?
I say this because we’ve all seen companies raise money, dilute shares, then reverse split to reset the stock price only to then repeat the process. Since a company can only issue as much as it’s Authorized to, reversing the stock decreases the OS but doesn’t decrease the AS. In this case, a reverse split essentially allows for more dilution risk. However, a company actually decreasing the AS may be something worth noting. In any event, SUNW stock has begun to climb at the start of the month.
Low Float Penny Stocks To Buy [or avoid]: MICT Inc.
Outstanding Shares: 11.11M
Like Britney and Cher, MICT has one name. However over the last few weeks, shares of MICT Inc. (MICT Stock Report) have been steadily climbing on relatively light volume. This is a clear example of how low float penny stocks can react in certain market conditions. If you haven’t heard of this penny stock before it’s likely because MICT stock doesn’t really trade a whole lot. On an active day, it may see a few hundred thousand shares trade. But in general, daily volume has been as low as a few thousand shares.
In any event, MICT Inc. develops, manufactures, integrates, and markets rugged computers, tablets, and computer-based systems. Its target markets include commercial, defense, and aerospace in the United States, Israel, and internationally. Earlier this year the company entered into a plan of acquisition with Global Fintech Holdgings. At the time, shares were trading below $0.60.
The deal was proposed at $26 million and there would be a $15 million funding commitment as well. Since then, however, not much has been mentioned about the deal. Along the way, MICT announced a few updates like receipt of FCC authorization by one of the company’s it holds a voting interest in. The company also reported earnings in the middle of June. Despite coming up short on EPS compared to last year, the big news came this week.
MICT announced the formal closure of the acquisition deal with Global Fintech Holdings. While the deal isn’t in cash but convertible securities, it brings in an asset that it believe could “springboard [MICT’s] future revenue and earnings growth”. That’s according to MICT CEO Darren Mercer. Will this low float penny stock continue to surge at the start of July or will the latest surge end as fast as it began?