What Does High Volume Mean For These Penny Stocks?
One of the top things traders look for in penny stocks is volume. You might look for catalysts like news, upcoming events, corporate filings, etc. But the one telltale sign of interest in a stock is volume. It doesn’t matter who you speak with.
If there’s no volume in penny stocks, then most of the time it’s “on to the next” one. For you volume hunters out there, what type of volume do you look for? Is it overall share volume, dollar volume, a mix of each? Comment below.
The reason I ask is that you can have certain penny stocks with a high volume of shares traded but a low price might not equate to much activity. On the other hand, you may have higher-priced, high volume penny stocks in terms of dollar volume, which might suggest higher levels of interest. It’s important to make this distinction. While I don’t cover them, there are plenty of sub-penny stocks, trading at $0.0001, for example.
Is Volume Important In Penny Stocks?
You might think that a day where said stock trades 500,000,000 was big. But at the end of the day, that half of a billion shares only accounts for about $50,000. I’m not saying it isn’t a lot of money. But what I am saying is that in the grand scheme of things, if only 50 people were to buy $1000 of that stock, now what? There’s no real market to make a trade. Let’s compare it to one of the penny stocks mentioned earlier today, Digital Ally (DGLY) for instance.
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That penny stock trades around $2.50 and while it’s “more expensive,” the liquidity in its market today accounted for about $40 million in dollar volume. Why is volume important? The higher the volume, the easier it tends to be in order to enter and exit a trade at optimal prices.
Is that always the case, no, and there are always exceptions depending on the individual instance. But as a rule of thumb, high volume penny stocks are ones that have both higher share volume and higher dollar volume. In light of this, here’s a list of penny stocks to watch experiencing both on Thursday.
High Volume Penny Stocks To Watch: Pacific Ethanol Inc.
Pacific Ethanol Inc. (PEIX Stock Report) another heavy day of trading volume on Thursday. In fact, since the end of July, daily share volumes have been well-above average. Considering the move PEIX stock made, that volume was heavily in favor of the bulls. From July 22nd through to this week, PEIX stock has been much more active than in previous months. You may also remember that this has been one of the penny stocks on the radar on PennyStocks.com since December of last year.
The company produces renewable fuels. It owns and operates several ethanol production facilities distributed across the Western and Midwestern United States. Back in July, the company announced that it expanded its production capacity of USP grade high-quality alcohol at its Pekin, Illinois facility by 30 million gallons per year. The new capacity is set to be online in the fourth quarter of 2020, supplying the growing demand for the company’s USP grade high-quality alcohol with existing and new customers.
Obviously, the need for its products is evident in today’s world of COVID. Furthermore, on August 11th, Pacific Ethanol reported an EPS beat and a sales beat for the quarter. EPS came in at $0.27 per share which beat the analyst consensus estimate of ($0.20) by 235%.
This is also a 258.82% increase over losses of ($0.17) per share from Q2 2019. Pacific also expects second-half adjusted EBITDA to range between $50 and $70 million. Considering this higher average volume, will PEIX stock remain on the hot penny stocks to watch, list in September?
High Volume Penny Stocks To Watch: VivoPower International PLC
Another one of the penny stocks we picked up on this week was VivoPower International (VVPR Stock Report). It was after its latest round of earnings and management conference call. But this isn’t the first time VivoPower hit the airwaves. Back in June of last year, was when we first started to follow its developments. At the time, VivoPower just announced that it won major contracts in Australian Solar and data centers. This boosted the company’s order book to more than $51 million at the time. A lot has changed since then and you can see that reflected in the recent financial results.
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As far as earnings went, the company experienced record annual group revenues. These came in at $48.7 million, up 12% year-on-year. VivoPower also saw a large improvement in an adjusted net after-tax loss. It came in at ($1.7) million and adjusted EPS of ($0.12) per share. Despite reported a loss, it’s considerably lower than what was reported for Fiscal 2019. Last year VivoPower reported an adjusted net after-tax loss of ($8.9) million loss and ($0.66) per share for FY19.
“Our primary goal is to consummate our first EV and sustainable energy solution orders. Obviously, in terms of announcing this, we are very confident that’s going to happen in short order,” as far as something to look at for potential future catalysts among other things. Will this momentum continue through the end of August?
High Volume Penny Stocks To Watch: Tonix Pharmaceuticals
Tonix Pharmaceuticals (TNXP Stock Report) is another one of the penny stocks we’ve seen with increased volume. If you look back in July, TNXP stock was on fire, running to highs of nearly $2.50. Considering it traded around $0.50 just a few days prior to the move, that was definitely a noticeable move.
Tonix entered into a research collaboration and option agreement with Columbia University. The focus was on studying the immune responses to COVID-19 in healthy volunteers who have recovered from coronavirus or were asymptomatic. Since that July move, however, TNXP stock has slowly come back to a level of relative support (for now) right around its 50 Day Moving Average. Over the last 3 days, however, shares have pushed higher.
There haven’t been many new updates since Tonix released earnings on August 10th. However, as readers know, you don’t just look at the news to find information. If you look at the latest string of filings from August 17th to the 24th, you’ll see something “interesting”. That “something” is a string of FORM 4 filings showing several officers and directors of Tonix buying shares in the market. Could this be one of the catalysts behind TNXP stock’s latest move this week?