These Renewables & EV Penny Stocks Are Jumping This Week But Will That Continue?
What are penny stocks? If you’re new to buying penny stocks, this might be the first question you’ll ask before exploring different companies. Simply put, the definition of penny stocks is simply shares of companies that trade below $5. I’m basing this on the standard definition provided by the Securities & Exchange Commission. While some traders may say that these are stocks under $1 or even stocks under 10 cents, we’ll goo off of the basic definition of penny stocks.
Given the surge of interest in small-cap stocks this week I’m guessing there are some new traders coming into the stock market today. One of the hottest parts of the market this week has been renewable energy and electric vehicles. There’s no denying that hype stemming from Tesla’s Battery Day has helped give these companies a shot of adrenaline.
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With that being the case, investors are scrambling for any opportunity that mentions “EV” and “Solar” during the second half of the week. While this is great for those taking advantage and making money with penny stocks, you’ve also got to keep risks in mind. Again, if you’re new to buying penny stocks, risk management might not be your forte. What’s the point?
Buying Penny Stocks On Robinhood
My point is this, penny stocks move quickly, they’re built for speed and can return big wins in no time. Remember that because it’s easy to get caught up in the hype. I’ve seen many of the millions of new users discussing penny stocks on Robinhood, Webull and other platforms more akin to a lottery ticket. The bottom line is that it doesn’t have to be that polarizing as an all or nothing trade.
You can buy penny stocks and consistently make money. It just comes down to the right strategy and – more importantly – treating these as investment vehicles. If you wanted to make 20% on a trade and your target stock is up 30%, you did what you set out to do. No one ever went broke taking profit.
With such a surge in the market recently for energy & tech penny stocks, there’s one big question being asked. Can this momentum continue without other followthrough catalysts?
Robinhood Penny Stocks To Watch: Gevo Inc.
While most traders were focused on penny stocks like SPI and SUNW, Gevo Inc. (GEVO Stock Report) stayed the course and continued inching higher. Don’t get me wrong, SPI was a big mover and likely a big winner for some. However, the followthrough hasn’t been there at all. In fact, SPI stock is now down more than 50% from its high, yesterday. Meanwhile, GEVO stock extended its uptrend, though slight, that began a few weeks ago.
Furthermore, it’s important to note that GEVO’s bullishness didn’t begin this month. We’ve been following Gevo’s progress since the start of July. Then in August GEVO stock experienced its first big spike. The move came after the company inked a Renewable Hydrocarbons Purchase and Sale Agreement with Trafigura Trading LLC. Through this deal Trafigura takes delivery of 25MPGY of renewable hydrocarbons starting in 2023. It also marked one of the biggest deals in Gevo’s history bringing Gevo “to over $1.5B of revenue in long term contracts when added to the other contracts we have in place” according to the company.
The global initiatives for fossil-fuel-less countries and states is helping to “fuel” a trend for certain names. Gevo has gotten wrapped up into this niche. Sweden has a goal of becoming “fossil-free” by 2040. Norway also announced a move to introduce biofuel blending through its own mandate. Furthermore, California is taking that a step further for. Gov. Gavin Newsom signed an order Wednesday that aims to end the sale of new gasoline and diesel-powered passenger cars in the state by 2035.
GEVO stock has bounced over 6% on Thursday. It will be interesting to see if that trend continues into the end of the week.
Robinhood Penny Stocks To Watch: CPS Technologies Corporation
CPS Technologies Corporation (CPSH Stock Report) made a quick reversal on Thursday. The penny stock reached a new Q3 low on Wednesday, but today CPSH stock bounced back over 20%. The company produces metal-matrix composite products for electrical systems.
Its products are used in motor controllers for hybrid and electric vehicles, trains, and even wind turbines. One of the biggest contributing factors right now is likely what Elon Musk said during his Battery Day presentation. Musk said that the company set a goal to make affordable EV’s for the market.
What’s more is that this goal isn’t just a few thousand additional vehicles per year. Musk set 20 million vehicles per year as the goal. Of course, components and car parts are going to be a need to meet this goal. Companies like CPS and others focused on developing products for things like EV’s have gotten some attention this week. What’s more is that CPS also has experience developing products for space missions. The company produced the AlSiC hermetic housing for the turret power supply for the SHERLOC scientific instrument on the Perseverance Mars rover.
From a technical perspective, CPSH stock has managed to hold its 200 Day Moving average as support for the last 2 weeks. Thursday is the first day that shares have made an aggressive move higher on above-average volume.
Robinhood Penny Stocks To Watch: Senmiao Technology Limited
Senmiao Technology (AIHS Stock Report) is another one of the penny stocks that may have benefited from growing interest in EV penny stocks. Earlier this year, the company announced a strategic cooperation agreement with Sichuan Hongyu Enterprise Management Co., Ltd. It was to facilitate the purchase of electric vehicles and cross-promote their brands, products, and services for a term of three years. The goal is to further expand its automobile transaction and related services business.
Xi Wen, Chairman, Chief Executive Officer and President of Senmiao said, “We shifted our focus during the quarter to a new opportunity, namely the provision of short-term car rentals…Creating this additional revenue stream has also helped to mitigate the drop in online ride-hailing automobile sales.”
Aside from this, there haven’t been many further updates from the company. If AIHS stock is on your list right now, keep this in mind. Typically, the sympathy trades can get volatile due to lack of additional information that might act as a follow through catalyst. In any case, AIHS stock has climbed over 45% on Thursday. Like CPSH, AIHS has seen a technical event at its 200 Day Moving average. This time it was the reverse as this level has acted as resistance in the past. Will that change after today?