What Are Penny Stocks?
Penny stocks are shares of companies trading under $5. So when it comes to making a list of these cheap stocks, your choices are pretty open. However, in today’s trading world, access to certain penny stocks might also depend on the broker you’ve chosen to use. Penny stocks on Robinhood, for example, are, for the most part, limited to stocks on the NASDAQ and NYSE.
You’re not likely to find any OTC penny stocks on Robinhood. On the other hand, using brokers like Schwabb, TD, Interactive Brokers, E*Trade, etc., will open up access to many more penny stocks to buy. Some of these accounts may be accompanied by small fees. So there could be a tradeoff. It’s important to account for these fees in your trading plan.
So are penny stocks worth your time? I’ll leave that up to you. But what I can say is that if you were watching any of the electric vehicle stocks under $5 this month, you would’ve seen some explosive moves. We’re talking stocks under $1 running to nearly $5 and other stocks under $5 jumping to highs of more than $13. For all intents and purposes, those able to manage risk and trade volatility had a chance to capitalize on these big moves. The fact of the matter is that these jumps all started from a list of penny stocks to watch.
So what should you be searching for today? Monday’s seen a bit of selling pressure in the broader markets. However, that doesn’t mean all penny stocks are down today. If you take a peek at a few sector trends, you might find some positive momentum. Healthcare, tech, and even some communications penny stocks have jumped on Monday. Will this trend continue into December?
Penny Stocks To Buy [or avoid]: Opko Health
Shares of Opko Health (OPK Stock Report) traded higher on Monday. This continued a now 2-day move that started on Friday. OPK stock reached highs of over $4.60 during the Monday morning session. While no news has come up from the company, momentum started building last week following news from one of its shareholders. Sian Capital urged Opko to begin selling its kidney disease drug Rayaldee in the U.S. and Europe as a potential COVID-19 treatment.
Sian Capital said Rayaldee could not only save countless lives but bring in “tremendous” revenue to the company. Rayaldee has been proven effective in raising Vitamin D levels which can help fight the coronavirus, said the asset manager. With headlines discussing COVID treatments, OPKO stock may have benefited from a bit of sympathy trading. What’s more is that this week, the company’s set to participate in a fireside chat at the Piper Sandler Annual Healthcare Conference. Will this become a topic of discussion for the company?
In September, Opko initiated a Phase 2 trial with RAYALDEE® as a treatment for mild-to-moderate COVID-19. Independent studies have reported a relationship between vitamin D status and COVID-19 risk and severity. OPKO is expected to report topline results from this Phase 2 trial before year-end.
Penny Stocks To Buy [or avoid]: Dynavax Technologies Corp.
Dynavax Technologies Corp. (DVAX Stock Report) had a strong open on Monday. Shares jumped to early highs of $5.10, up over 4% from its previous close. What’s more, is DVAX stock has managed to climb over 30% so far. This week the company presents at the Evercore ISI HealthCONx Conference.
The company’s latest focus is on clinilcal progress in a COVID-19 vaccine candidate. Earlier this month Dynavax and Biological E. Limited along with Baylor College announced the initiation of a Phase I/II trial of Biological’s COVID-19 vaccine candidate in India. The Drugs Controller General of India had approved the trial, which will evaluate the safety and immunogenicity of the candidate.
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Considering the focus on COVID-19 vaccine stocks right now, DVAX could be experiencing some sympathy momentum right now. In addition, if this is on your list of penny stocks, keep December 3rd in mind as this is when they present at the Evercore conference.
Penny Stocks To Buy [or avoid]: Kopin Corp.
Kopin Corp. (KOPN Stock Report) reached a new Q4 high on Monday. In fact, over the last week of trading, KOPN stock’s trading volume has experienced above-average levels, daily. Unlike the two companies previously mentioned, Kopin is one of the tech penny stocks to watch. Kopin provides transmissive and reflective LCD and OLEDmicrodisplays for military, enterprise, industrial, consumer, and medical applications.
Earlier this month the company announced its White Pearl® Optical Module and A230 Driver IC are delivering hands-free AR imagery to frontline remote workers who wear Iristick smart glasses. Iristick’s smart safety glass is a smart-glass solution for remote assistance and workflow guidance. When you talk about 21st century tech, this is something unique. “Field technicians utilizing Iristick’s smart glasses are connected with remote experts, zooming in on the smallest details and communicating in real-time to get the job done. This is proving to be extremely useful as travel restrictions due to COVID-19 limit the experts’ ability to fix issues on-site.”
Once again, COVID-19 developments may be playing a vital role for KOPN and other related stocks. As new cases remain a key focus, will this recent bout of momentum carry these penny stocks higher in December?
Penny Stocks To Buy [or avoid]: Pulmatrix Incorporated
Pulmatrix Incorporated (PULM Stock Report) jumped above its 200-day moving average for the first time since July, on Monday. These technical levels remained a strong point of resistance on the penny stock’s chart for months. Prior to this, the 50-day was acting as resistance for the majority of the last few months. One of the key drivers this month, as you may have guessed, has to do with COVID-19 related developments. While it wasn’t new from November specifically, the spotlight on companies within the arena has helped give PULM stock a boost recently.
In late October, Pulmatrix had announced the commercial launch of its FEND product. It’s an over the counter nasal hygiene spray. As Ted Raad, CEO explained, “There is a growing body of scientific evidence that FEND, delivered by Sensory Cloud’s FEND Mister, has the ability to reduce bioaerosol production, addressing even the smallest aerosol particles not blocked by masks.”
Aside from this, the company could also have potential milestones ahead as indicated in its November business update. Pulmatrix is advancing PUR3100, its inhaled candidate for acute migraine. The company said it’s on-track to identify its lead formulation for non-clinical PK studies by the end of 2020.
Penny Stocks To Buy [or avoid]: Organigram Holdings
Marijuana stocks are in the spotlight this week as well. They tend to fall into the “health and wellness” portion of “healthcare”. More importantly, there could be a government-supported catalyst to pay attention to as well. The U.S. House of Representatives is planning to vote on the MORE Act in the first week of December.
While Organigram Holdings (OGI Stock Report) is more focused on the Canadian market, Robinhood traders have flocked to any marijuana stock accessible on the platform. The fact of the matter is that most U.S. marijuana stocks aren’t listed on the platform. The vast majority are OTC penny stocks and therefore are restricted from Robinhood traders. Regardless, sympathy momentum isn’t the only thing driving OGI stock this week.
On Monday, the company reported its fiscal Q4 earnings for 2020. Fourth quarter 2020 net revenue increased 25% to $20.4 million from $16.3 million in Q4 2019. Furthermore, Q4 2020 gross revenue increased 32% to $25.4 million from $19.2 million in Q4 2019. Aside from this company-specific headline, traders will likely be closely monitoring developments with the upcoming vote this week.