3 Penny Stocks To Watch After Friday’s Late Afternoon Surge
We’re heading into the last full week of the month and the second half of the third quarter. Despite lighter volumes in the stock market, penny stocks are still on the radar. High-risk and high-reward are the focus and finding the perfect mix is the goal. Most of the year has been full of, well, surprises.
Whether it’s the latest coronavirus figures, economic data, or geopolitical updates, there’s been no shortage of excitement. However, we have seen quite the market recovery since March’s big sell-off. Does this mean the worst is behind us or is there still more to come? And yes, who can forget that it’s an election year and within 3 months’ time, we’ll actually know who America chooses as its new President.
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So what lies ahead next week? There’s another round of economic data to digest. We’ll also see the earnings season start to slow a bit. This will be on the heels of one of the hottest weeks in the stock market, which hit new all-time highs on Friday. There could be some volatility ahead, however, that’s if the Fed is correct. “The market has gotten very optimistic about the economy and reopening. I think the Fed senses there’s going to be some sort of fallout from this,” said Shawn Cruz, manager of trader strategy at TD Ameritrade. The Fed itself also said the ongoing pandemic “would weigh heavily on economic activity, employment and inflation in the near term.”
So some cautionary stance taken by the Fed will certainly be in the back of investors’ heads. Despite this as the case, it has been this volatility that has traders hungry for another round of big market moves. When it comes to individual stocks, of course penny stocks are some to look at. No matter what the broader markets have done, a number of stocks under $5 have ended up breakout out big. Will any of these be on the list for next week?
Penny Stocks To Watch: MOGU Inc.
MOGU Inc. (MOGU Stock Report) was on our list of penny stocks to watch last week. This company gained attention after announcing its official earnings date. Another thing that could have helped boost interest was the sympathy in the Chinese retail sector last week. Much of the anticipation in that sector was likely a lead up to Alibaba’s earnings results. Other sector stocks from the likes of Baidu and JD.com traded similarly as well.
MOGU is on the list this week is somewhat of a “high risk/reward” situation. The reason being is that it reports earnings this week. Keep this in mind as positive results can be a bullish catalysts and negative results, the opposite. Specifically, August 24th is the date and the company will release results before the open with an early conference call at 7:30 AM EST.
Its 3rd quarter results were mixed as MOGU experienced growth in certain business units. However. Despite these few positives, MOGU’s revenues declined 26% year over year. When it comes to full-year fiscal results, the company saw total revenues decrease by 22.2%.
A key focus moving forward for MOGU will be its Live Video Broadcast Business or “LVB”. Most of its category revenues don’t compare to the growth this one particular category is delivering. Despite the overall picture being muddy, it may be the one standout to focus on if MOGU stock is on your list. LVB Active Buyers in Fiscal Year 2020 Increased 44.9%
Raymond Huang, Chief Strategy Officer of MOGU said, “LVB gross merchandise value (GMV) accounted for the majority of our GMV for the second consecutive quarter which reflects the direction that we are heading towards. Over the past 12 months, we have been focusing our attention and resources on our innovative LVB e-commerce strategy.”
Penny Stocks To Watch: Hudson Capital Inc.
We’ve covered penny stocks on the rise as well as penny stocks dropping. Each has its specific reasoning behind the focus. However, when irregular momentum or unusual volume is at play, it’s not bad to understand why, at the very least. For this reason, Hudson Capital Inc. (HUSN Stock Report) is on the list of penny stocks to watch right now.
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Late last week, shares dipped even lower in its latest, multi-week drop. At the end of July, HUSN stock began its descent stemming from announcing financing for $1.6 million at $0.45. Considering HUSN stock was trading around $0.60 on the date of the announcement, it’s no surprise that shares have now dropped to around that financing price per share.
Essentially, with that “out of the way,” there haven’t been many additional updates from the company. Yet, on Friday after the closing bell, the penny stock ended up jumping as high as $0.599. So, naturally, we turn to the filings to see if there was something released. Sure enough, we see 2 filings from August 21st. One is a 13D and the other is a 6-K. The former shows that PX Global Advisors LLC now holds a 39.16% stake in the company.
In addition, the company’s 6-K filing showed that Hudson appointed Hon Man Yun to succeed Jinchi Xu who tendered his resignation for the CFO position. However, I think the 13D is something that has started gaining some buzz. We’ll have to see how the market reacts heading into the week.
Penny Stocks To Watch: Evofem Biosciences Inc.
Evofem Biosciences Inc. (EVFM Stock Report) is another one of the penny stocks we started looking into last week. One of the main focuses of the company has been on its pregnancy prevention, prescription gel, Phexxi. Evofem is also advancing its EVO100 into Phase 3 clinical trials for the prevention of urogenital transmission of certain STDs in women. In its most recent earnings update, the company said the EVO100 study is on track to begin next quarter. Furthermore, the commercial launch of Phexxi is set for September 2020.
“We are now intensely focused on the successful commercial launch of Phexxi in September and ensuring the team’s ongoing excellence in execution with manufacturing timelines, payer coverage, sales force recruitment and the build-out of our unique telemedicine platform — the Phexxi Concierge Experience. It’s going to be an exciting third quarter.”Saundra Pelletier, Evofem’s Chief Executive Officer
While EVFM stock slid during the second half of the week, it seems, like HUSN, that momentum built after the closing bell. This is when the company announced the approval of new inducement grants to 60 new employees. While this wasn’t groundbreaking material events for the company’s pipeline, it seems to have gotten some attention. Aside from this, EVFM stock also received interest from analysts at Morgan Stanley last week. The firm started Evofem at Equal Weight and placed a $13 price target on the penny stock.