Are These 3 Penny Stocks On Your Watch List Right Now?
While broader markets finally begin recovering, penny stocks continue setting new records. If you look at one of the benchmark ETFs for small-cap stocks, you’ll see what I’m talking about. The Russell 2000 (IWM ETF) has continued setting record high after record high this month. Monday’s session was no different.
The early morning session saw the IWM reach $201.18 for the first time ever. While the IWM isn’t made up of all penny stocks, it is something we look at to gauge interest in smaller companies. What’s more, is that now that the broader markets are back in motion, it could make for a bullish case across the board.
One of the driving forces behind this upbeat market momentum is the stimulus. Specifically, President Donald Trump recently signed a $900 billion coronavirus relief package into law. It includes a direct payment of $600 to most Americans. Furthermore, with vaccine distribution officially commencing, it has further triggered bullish sentiment on the economy as a whole. Something to remember, however, is that we aren’t out of the wood yet.
Many Americans are still without work due to COVID restrictions. One shining light shed on Tuesday comes in the form of additional stimulus measures. The House of Representatives voted to pass a bill to increase the direct payment amount. This would see $600 more than triple to $2,000. Now the bill moves to a Senate vote. Needless to say, the fact that there is a new stimulus plan in place already has helped markets surge higher. With that several penny stocks are pushing toward new highs as well.
Penny Stocks To Watch #1: NTN Buzztime
NTN Buzztime (NTN Stock Report) is one of the penny stocks to watch this week. While you might think that as an entertainment company, stimulus news was a catalyst, I think there may be something else to point to. If you look at the company’s filings from last week, you’ll see what I’m talking about.
NTN Buzztime and Brooklyn ImmunoTherapeutics LLC entered into an agreement and plan of merger and reorganization, dated August 12, 2020. A wholly-owned subsidiary of NTN, BIT Merger Sub, Inc., will merge with and into Brooklyn, with Brooklyn surviving as a wholly-owned subsidiary of NTN. The deal would result in a biopharmaceutical company focused on Brooklyn’s business of exploring the role that cytokine-based therapy in treating patients with cancer.
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So what’s important about this proposed merger right now? If you look at the latest Amended S4 Filing, you’ll see that either party may terminate the Merger Agreement if the Merger has not been consummated by December 31, 2020. Considering that the date is quickly approaching, is this latest momentum stemming from speculation on the proposed merger? In any event, NTN stock continues making new December highs this week.
Penny Stocks To Watch #2: Regional Health Properties
Regional Health Properties (RHE Stock Report) stoked big interest on Monday. That saw shares of RHE stock skyrocket to highs of $15.77. It looks like the main catalyst for that move was simply a low float stock with above-average trading. The company even came out with a statement saying that it wasn’t aware of any material change in business.
Needless to say, it had put the penny stock on many traders’ radars this week. Tuesday continued seeing strong momentum early on. Shares traded around $3.60 with volume building. Regional Health is a healthcare real estate investment company. It invests mainly in real estate purposed for senior living and long-term healthcare through facility lease and sub-lease transactions.
If RHE is on your watch list, keep in mind that speculation and technicals are likely more a focus than fundamental right now. In its most recent quarterly update, the company recorded a strong drop in EPS as well as a year-over-year slide in sales for the quarter.
Penny Stocks To Watch #3: Tenax Therapeutics Inc.
Tenax Therapeutics Inc. (TENX Stock Report) is another one of the penny stocks pushing toward new December highs on Tuesday. The company’s stock has been relatively quiet for the majority of December. However, recent analyst coverage has sparked renewed interest in the stock. This week H.C. Wainwright started Tenax with a Buy rating. The firm also gave a price target of $5.
Tenax develops products for the critical care market and recently completed a Phase 2 trial of its heart disease treatment, levosimendan. The company is set to move forward with a Phase 3 program. Tenax reported in its Q3 business update that it expects to reach an agreement with the FDA on a path forward before the end of Q1 2021.
“The recent announcement related to adding the oral formulation of levosimendan by expanding our license agreement with Orion is an exciting opportunity for us. We believe an oral dosage form will be more convenient to patients in the Phase 3 program, thus potentially making the trial easier to enroll and perhaps shortening the overall time to complete the program.”Anthony DiTonno, Chief Executive Officer of Tenax
So as the market awaits more details on the meeting with the FDA, traders have grown bullish along with analysts.
Penny Stocks To Watch #4: BIO-key International
BIO-key International (BKYI Stock Report) popped above its 50-day moving average for the second time this month. It’s been a relatively consistent level of resistance for the penny stock during the second half of the year. While there weren’t any headlines to pair with the latest momentum, current events could be something to keep in mind.
The company provides identity and access management solutions using biometrics. Obviously, the “new normal” is still beginning to flesh itself out. The recent launch of BIO-key’s PortalGuard has become somewhat of a bigger focus for traders. This is the company’s identity and access management platform for biometric authentication.
PortalGuard helps organizations across all industries become secure “cloud first” businesses. This month, the GATX Corporation expanded its use of PortalGuard to its GATX Rail Europe operations. GATX is a global railcar leasing company. According to the company, “Due to the COVID-19 pandemic, GATX Rail Europe’s operations team has shifted most of their employees to remote work, creating the need to implement secure password management from remote locations.”
What’s more, is that this month saw additional interest from insiders. Form 4s show that the company’s CEO as well as its Senior Vice President and Chief Legal Officer picked up shares of BKYI stock in December.