Can These 5 Penny Stocks Continue to Rally?
Throughout the month of December, investors have seen a lot of positive sentiment with penny stocks. While trading these stocks has changed in 2020, the majority of the factors remain largely the same. This includes understanding the fundamentals of a given penny stock, and any research methods that one uses.
Beyond this, there are a few things that have changed this year for penny stocks. For one, the introduction of the coronavirus means that all world economies have been affected. While it is undeniably a travesty that this disease exists, there are some ways that penny stock traders can benefit. The first is identifying key areas of the stock market that may see more value due to the pandemic. This includes digital communications, mining stocks, energy stocks, tech penny stocks, and others.
- 9 Meters Biopharma Inc. (NMTR Stock Report)
- Vistagen Therapeutics Inc. (VTGN Stock Report)
- Mereo BioPharma Group ADR (MREO Stock Report)
- Aikido Pharma Inc. (AIKI Stock Report)
- Canaan Inc. (CAN Stock Report)
In addition to this, the election of Joe Biden as president of the U.S. means that there are some opportunities that could play out in the future. This includes opportunity with marijuana penny stocks, electric vehicle penny stocks, and renewable energy stocks.
While all of this is considered to be speculative, there’s no doubting that 2020 is different from the rest. And with only two weeks left in the year, 2021 is upon us. With that in mind, here are five penny stocks to watch as December comes to a close.
Penny Stocks to Watch: 9 Meters Biopharma Inc.
9 Meters Biopharma is a biopharmaceutical company working on producing medicines for the gastroenterology industry. The company states that it has several drugs that are currently in its pipeline including NM-002, Larazotide, and more. These substances are used to treat everything from celiac disease to stomach disorders.
9 Meters states that its drug, Larazotide, is in the midst of a Phase 3 study to discover its efficacy in treating non-responsive celiac disease. On December 15th, 9 Meters announced that it had closed on a public offering of common stock. The deal, worth around 53 million shares at a price of $0.65, should help to raise around $32 million.
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With this, the company will be able to further the clinical studies of Larazotide, as well as for corporate and general administrative purposes. This is quite a common financial instrument for biotech companies to utilize. For one, it allows a company to raise money without the worry of acquiring unnecessary debt. Two, biopharmaceutical companies often don’t see a great deal of revenue prior to having a substance approved by the FDA. While it is in Phase 3 trials right now, it may take some time before these drugs are studied to the full extent.
Penny Stocks to Watch: Vistagen Therapeutics Inc.
Vistagen Therapeutics Inc. is a biotech company that shot up greatly in value on December 17th. By the end of the trading day and into after hours, shares of VTGN stock shot up by as much as 38%. For some context, Vistagen works as both a biotech and biopharmaceutical company based in the U.S. The company states that it currently has three drugs in its pipeline.
These drugs are used in the treatment of anxiety, depression, and several central nervous system disorders. In the clinical studies that have occurred so far, all three of Vistagen’s drugs have shown a high level of efficacy and safety. Now, we can move on to the reason that VTGN stock shot up so much on December 17th. At 4 P.M. on Thursday, Vistagen announced a proposed underwritten public offering.
The goal with this is to raise money to work on the research and development of its drugs PH94B, PH10, and AV-101. In addition, the company states that it wants to expand its pipeline to work on other drugs to treat life-threatening disorders. As stated earlier, this is a very common financial instrument that biopharmaceutical and biotech companies use to raise funds. While it does offer some degree of share dilution, this is a better alternative than a debt financing option. With its three drugs hoping to see approval in the future, it looks like Vistagen has a lot going for it at the current point in time.
Penny Stocks to Watch: Mereo BioPharma Group ADR
Mereo BioPharma Group ADR is another biopharmaceutical company that saw its shares pop on December 17th. At the end of the day, shares of MREO stock shot up by almost 37%. This is a big jump for the company and it is underlined by news that came out during the day. On Thursday, MREO announced that it has entered into a collaborative licensing agreement for Setrusumab with the biotech company, Ultragenyx Pharmaceutical Inc. (RARE Stock Report). In the deal, Mereo will receive around $50 million in upfront funding and is eligible for later funding up to $254 million. This deal revolves around the treatment of osteogenesis imperfecta, which is a rare genetic disease.
Denise Scots-Knight, CEO of Mereo, stated that “we are proud to partner with Ultragenyx to continue the development of setrusumab as potentially the first approved therapy for OI in both children and adults. We believe that Ultragenyx, with its proven track record of successfully developing and commercializing novel therapies for rare diseases, is ideally positioned to support the further advancement of our innovative therapeutic candidate.”
This is a major step for both companies and should help to potentially produce positive results for the pair. While the full details and time needed for this deal to complete are still up in the air, it does remain big news for both parties. With this in mind, investors could consider MREO to be a penny stock to watch.
Penny Stocks to Watch: Aikido Pharma Inc.
Aikido Pharma Inc. is the last company on this list that works in the biotech industry. Despite this, Aikido Pharma operates differently from many other biotech companies. Specifically, the company offers a platform for the commercialization of protected healthcare products and technologies. In addition to this, the company works in wireless communications, satellite and solar.
As you begin to see, Aikido Pharma is quite a broad penny stock with its hands in a lot of different markets. But, this is one of the reasons that some investors could consider it a penny stock to watch. Recently, the company announced the publication of a positive result stemming from its AI and machine learning research program regarding pancreatic cancer.
One of the issues that Aikido is trying to solve is the diagnosis of this disease. Often times, pancreatic cancer can be deadly due to diagnoses not occurring until the latter stages of the illness. Because of this, Aikido has stated that there is a large need for both screening methods and therapeutics to solve the illness altogether. While these solutions may be a ways away, there’s no doubt that Aikido is working hard to get there. With this and other business opportunities in the works, investors could consider AIKI stock to be a penny stock to watch.
Penny Stocks to Watch: Canaan Inc.
Canaan Inc. is a penny stock that we have written about several times within the past few weeks. The company works as a blockchain server producer and microprocessor producer for the purpose of mining bitcoin. In the past month, shares of CAN stock have shot up by more than 30%. In the past six months, shares are up by over 120%. One of the main reasons behind this upward trajectory is the increased emphasis on bitcoin in the past few months.
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After Bitcoin hit $20,000 per coin on December 16th, investors began to pay attention to the currency once again. Since the end of December, the price of BTC has shot up by around 25%. As you can see, this is very similar to the gain seen with CAN stock. Because the two are so closely tied together, investors should watch out for heightened volatility with CAN stock.
One of the reasons that investors like Canaan Inc. are that it offers exposure to bitcoin without actually purchasing cryptocurrency. Some investors fear that Bitcoin itself could continue to be a bubble rather than a long term investment. But, those same investors cannot deny the massive moves that bitcoin has made in the past month or so.
With that in mind, CAN stock is an alternative way to get a foot in the door with cryptocurrency without walking inside. Investors who think that CAN stock is a penny stock to watch should also keep a close eye on the cryptocurrency sector.