Will These Penny Stocks Remain Below $2.25 In August?
As the saying goes, you get what you pay for. But does that apply to penny stocks? Granted, these stocks under $5 are “cheap” according to most. But these small- and micro-cap stocks can pack a punch. This year it’s been quite evident as to why penny stocks can be worth your time and then some.
Despite the higher volatility and higher risk that goes along with these types of investments, traders are finding plenty of opportunities to capitalize on small price movements. On top of that, they’re also finding that certain types of share structures associated with a few penny stocks lend themselves to even larger and faster moves.
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What I’m talking about there are low float penny stocks. Remember Kodak? That penny stock exploded at the end of July. While it has since imploded, the facts remain, there was a 3- day stretch that KODK stock moved from under $2.20 to $60 a share. As a low float penny stock itself, the companies stock rose on the back of big news related to a proposed government loan. KODK is also a shining example of that “risk/reward” I was talking about earlier.
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For instance, the first day that shares gapped up, Kodak stock ended up moving to highs of $9.18 and then came sliding back down to close at $8.43. Considering the pullback, many cautious traders avoided it after the slide. However, if you were lucky enough to hold shares by “day 3”, KODK ended up gapping to over $18, ran to $60, and closed at $33.20.
As they say, the rest is history. While it isn’t a penny stock anymore, it has fallen more than 85% from those $60 highs. Is there risk with penny stocks? Obviously, but is that coupled with potential rewards like KODK before “day 4”?
That answer is yes. Will all penny stocks trade the same way, no, but there are plenty to take a look at for less than 2,700% moves. Here’s a quick list of stocks that can be bought for less than a cup of coffee. Just because they’re inexpensive, are they the best penny stocks to buy right now? I’ll leave that up to you to decide.
Penny Stocks To Buy Under $2.25: Avinger Inc.
Shares of Avinger Inc. (AVGR Stock Report) saw another tick higher on Friday. AVGR stock’s been holding a consistent uptrend for most of the second quarter and volume has also picked up. Avinger is a commercial-stage medical device company that designs and develops an image-guided, catheter-based system for the diagnosis and treatment of patients with Peripheral Artery Disease. After raising some capital and reporting an earnings beat, the company’s continued turning heads in August.
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As you may have already known, we picked back up on the company at the beginning of the month. There haven’t been too many non-financing related updates to speak on so far. But there is an outstanding item that the company is still waiting to hear back on.Jeff Soinski, Avinger’s President and CEO made comment on this point.
“In May, we submitted a 510(k) application for U.S. pre-marketing clearance of our Ocelaris image-guided CTO crossing catheter. We also made significant progress in the development of our new L300 imaging console, which will provide our proprietary imaging capabilities in a much smaller form factor and at a lower cost. On the clinical front, completion of our INSIGHT IDE study remains a priority as it supports an anticipated future 510(k) filing for an expanded indication of plaque removal from in-stent restenosis (ISR) with the Pantheris catheter.”
In light of the recent developments and trend, do you rate AVGR one of the penny stocks to buy, sell, or hold right now?
Penny Stocks To Buy Under $2.25: Lipocine Inc.
Another one of the companies that haven’t been a stranger to watch lists is Lipocine Inc. (LPCN Stock Report). This year we began picking up on its developments during the middle of the first quarter. That came after the FDA indicated Lipocine’s approach to addressing the single remaining deficiency through the reanalysis of existing data in accordance with FDA feedback appeared to be a reasonable path forward. That was related to Lipocine’s TLANDO treatment.
If you’re not up on the history of TLANDO, just look at November of last year. That was when the FDA sent a Complete Response Letter to Lipocine regarding its previous New Drug Application for TLANDO. Essentially, a Letter like this from the FDA says to a company that an application can’t be approved. Hence, the massive sell-off in November.
But the company is taking another crack at it and obviously worked with the FDA to obtain a reasonable path forward. The next Prescription Drug User Fee Act (PDUFA) goal date is this month on August 28, 2020. So it’s not surprising to see momentum and speculation build. The biggest question, however, is twofold: will Lipocine experience a similar situation again as it did in November? Also, even if it doesn’t, is the latest move a “buy the rumor, sell the news” type of event?
Aside from TLANDO, the next “near term” pipeline treatment appears to be Lipocine’s LPCN 144 for treating non-cirrhotic NASH. The company has an on-going Phase 2a LiFT clinical study in biopsy confirmed NASH subjects. These results are expected by the end of 2020. Where do you have LPCN right now? Is it one of the penny stocks to buy, sell, or hold in your opinion?
Penny Stocks To Buy Under $2.25: Outlook Therapeutics Inc.
Outlook Therapeutics Inc. (OTLK Stock Report) is in a similar situation as Lipocine. While it has also enjoyed a few months of an uptrend, I’m referring more to what it could be set to report later this month. This is based on the company’s recent business update. On August 14th the company released earnings, which included a loss per share of $0.03 for the period. But obviously investors and traders weren’t paying as much attention to the financials as they were management’s discussion.
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The company reported that it successfully completed enrollment for its NORSE 2 study, in July. That’s important because of what followed that topic. Outlook said it plans to report topline results from that study this month. No formal date was reported, however. “In addition to successfully completing two strategic financings during the last quarter that helped provide a meaningful cash runway as we advance ONS-5010 towards a BLA submission, we continued to achieve important clinical milestones,” said Lawrence A. Kenyon, President, CEO and CFO of Outlook Therapeutics.
“This month we are on track to report topline safety and efficacy results from our NORSE 1 study in wet AMD. The data from this study in addition to the pivotal NORSE 2 data and the results of NORSE 3, which we expect in the third calendar quarter of next year, should be sufficient to support our BLA filing in the second half of 2021.”
On the same token as Lipocine, are we seeing a “buy the rumor, sell the news” event right now or will this bull trend continue through the rest of the month? Feel free to comment below.
