When It Comes To Penny Stocks To Buy, Do You Agree With These Analysts?
When it comes to penny stocks, do you trust analyst ratings? Wall Street has plenty of them but different firms evoke different sentiment in some cases. Have you ever found penny stocks to trade and all of them climb after the same analysts pick up coverage? In that case, you’re likely to continue following or searching for other companies that analysts from the same firm are covering. Similarly, what about an analyst you’ve never heard of before. What if there’s a penny stock you like but a “no-name” firm begins covering the company.
Does it make you second-guess your decision or are you now more curious? At the end of the day, following analyst ratings is just one small piece of your research strategy. Learning how to trade penny stocks takes more under consideration than what one firm opines. Take into account all facets of research including news, upcoming events, and filings, for instance.
Then, if you want to compare your thesis to what Wall Street firms think, you can do so. For all intents and purposes, these ratings aren’t dictating the pulse of the market. However, when a well-known firm begins covering certain penny stocks, it tends to act as a positive catalyst. Needless to say, due diligence or “DD” for short should entail many more things aside from these ratings.
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You’ve also got to consider when these ratings were given, especially when it comes to penny stocks. As we know, stocks under $5 fluctuate more quickly than blue-chips. So understand that what an analyst thought 8 months ago might not be the same later on. However, with analysts recently putting new ratings on these companies, are they on your list of penny stocks to buy or avoid right now?
Penny Stocks To Buy [according to analysts]: Xeris Pharmaceuticals Inc.
Xeris Pharmaceuticals Inc. (XERS Stock Forecast) has been on our radar recently. Since the beginning of the third quarter, XERS stock has turned heads. Initially, it wasn’t for the best reasons. Shares plummeted from over $5 to under $2.50 after the company announced a $20 million stock offering and a $75 million convertible note offering at the end of June. However, since then, XERS stock has been somewhat of a force to reckon with.
As one of the epicenter penny stocks to watch right now, Xeris Pharmaceuticals’ position in biotech places it in a hot sector. Obviously, when it comes to penny stocks, early phase trial data is very important to traders. In July, the company released additional data from a Phase 1b Comparative study of its concentrated diazepam formulation, XP-0863 for seizures.
The FDA provided feedback that Xeris’ drug development program could advance directly into a Phase 3 registration study in both pediatric and adult patients with epilepsy. On top of that, Xeris launched its Gvoke HypoPen™. Specifically, GVOKE® is indicated for the treatment of severe hypoglycemia in adult and pediatric patients with diabetes ages 2 years and above.
Among the majority of analysts that have rated XERS, the average is a Buy. However, most recently, the firm bringing coverage to the company was Mizuho. In August, the firm reiterated its Buy rating on the penny stock. It also set a $14 price target for XERS.
Penny Stocks To Buy [according to analysts]: Diffusion Pharmaceuticals Inc.
Diffusion Pharmaceuticals Inc. (DFFN Stock Forecast) saw a strong after-hours move on Tuesday. Back in July, the FDA gave guidance on the company’s Investigational New Drug application. This was for its trans sodium crocetinate (TSC) in COVID-19 patients. The FDA’s guidance suggested specific study design changes with regard to endpoints and statistical considerations. Diffusion believed these would enhance the prospect of regulatory approvals upon program completion, should the clinical results be favorable.
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The penny stock, for the most part, has maintained a sideways trend for the last few weeks. However, over the last several days, DFFN stock began sliding below its 1-month channel. We also haven’t heard much of any follow up to that July update. What we have seen, however, are news headlines coming from Diffusion on Tuesday.
Aside from appointing a new board member, Diffusion announced something else. The company reported that full regulatory approval has been received from Romanian regulatory authorities to begin enrollment in its 24- patient, open-label lead-in Phase 1b clinical trial in hospitalized COVID-19 patients at the Romanian National Institute of Infectious Diseases.
Now, I know if you’ve been a long-time reader, you’ve heard something before. That is, read more than just the headline. The main reason is that today’s DFFN stock news had a headline of “Diffusion Pharmaceuticals Appoints Jane H. Hollingsworth to its Board of Directors.”
If that’s all you read, you might’ve missed this regulatory update. We’ll have to see how the market reacts in September. Needless to say, recent ratings in August come from H.C. Wainwright who gave DFFN a Buy and A $3.50 price target in August.
Penny Stocks To Buy [according to analysts]: Party City Holco Inc.
Party City Holdco Inc. (PRTY Stock Forecast) joins this list as no stranger to the “penny stocks to watch” in Q3. It’s somewhat of a unique scenario especially considering that it’s generally thought of as a brick and mortar business. Most of these types of companies either went bankrupt or out of business amid mounting pressure from the coronavirus shutdowns. Party City, on the other hand, has so far weathered the storm. When we first began following PRTY stock more closely in May, the company had found itself actually benefiting from things like drive-by birthdays.
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One of its main assets revealed itself in a recent earnings update. Party City reported stronger than expected sales for the recent quarter. It missed on EPS, however, the company pointed out other key topics that surprised the market a bit. One of these was its North American e-commerce sales. Party City saw these sales increase 83.2%. This also helped the company beat analyst estimates on revenue for the quarter. The company reported $254.7 million in revenue for the quarter. This outpaced estimates of $225.67 from Wall Street.
With this busiest season quickly approaching – Halloween – eyes are on the company’s next steps. If you look at what analysts think, the general rating is closer to Hold than anything else. However, the most recent comes from Credit Suisse Group. The firm had an “Outperform” rating on PRTY stock. Though it did decrease its price target from $5 to $4 in June. Considering the recent uptick in PRTY stock, will analysts’ expectations shift in September?