Should These Cheap Stocks Be On Your January Watch List Right Now?
So far in January 2021, penny stocks have been quite good to investors. While it does depend on the industry, large news events can spark price movement across all areas of the stock market. These are some of the most frequent catalysts that traders react to. Not only do news events inform the market, but they can also leave certain things open to interpretation. In that case, we tend to see more speculation build. This can lead to higher levels of volatility which is quite common in the stock market.
But, with penny stocks and especially those under $2, volatility can often be higher than average. In this case, it’s important to keep your trading strategy in mind. As we’ve seen already this week, low-priced stocks can experience extreme moves. If you want to tlka about speculation, look no further than Signal Advance (OTC: SIGL). That OTC penny stock raced from just 60 cents to over $70 a share within 3 days. See: Penny Stocks & Mistaken Identity As Tweet Triggers 11,780% Jump For SIGL.
Did the company announce a groundbreaking development? Possibly a cure for a life-threatening disease? No, the penny stock broke out on speculation that this was the company behind the wildly popular Signal app Elon Musk tweeted about last week. Was money made by some? Of course, it was but look at a chart of SIGL stock and I’m willing to bet that there are plenty holding the bag still. Those who are bagholding likely didn’t have a strategy in mind, nor understand why the stock was moving in the first place.
This is why, when it comes the cheapest stocks in the market, you understand why they’re moving. You should also have a strategy in mind before even pulling up an order form to buy them. With this in mind, here are a few stocks under $2 trending right now. Will they be on your watch list before next week?
Penny Stocks to Watch Under $2
Castor Maritime Inc.
After announcing the completion of a direct offering on Tuesday, January 12th, shares of CTRM stock soared by around 19% during midday trading. Last week, CTRM announced the offering, which would include the sale of 137 million common shares at a price of $0.19 per share. The gross proceeds from this deal should come in at around $26 million. As a maritime shipping company, Castor Maritime will use this capital to buy more ships and continue operating its current fleet of six vessels. While CTRM has only been around for a few years, the company has made some big strides in the shipping industry.
It states that its focus is on dry goods that are shipped in a medium-term time frame. This includes goods such as grains, coal, and other dried products. In the shipping industry, the amount of ships that a company has is directly correlated to the income it can pull in.
If Castor Maritime is able to acquire more ships, it could become a larger player in the shipping industry overall. With the pandemic in full swing, there is an even higher demand for shipped goods. Additionally, online marketplaces have made the globalization of goods much more efficient, therefore increasing the need for shipping solutions.
Biolase Inc. is a penny stock that we have been covering for quite some time. Shares of BIOL stock have rocketed much higher in several recent trading sessions. This includes an almost 60% gain as of Tuesday, January 12th. In the past month, shares have risen by over 210%. Its price action is one of the reasons that we have covered BIOL stock so many times. But its business model is also of interest.
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The company produces a large range of laser products that can be used across the dental industry. With dental operations back to around 80% of pre-COVID levels, Biolase has started seeing more demand from its customers. The company has a very large market that it supplies. Its lasers can be used in anything from cosmetic to intensive surgery procedures. Because of this, it has earned the title as the global leader in dental lasers.
On Tuesday, January 12th, big news came out, stating that Biolase has entered into an agreement with DSO Dental Care Alliance. For those who don’t know, the Dental Care Alliance or DCA, is one of the largest organizations for supporting dentists in the U.S. It has as many as 330 dental practices in its organization and works across 20 states in the country. The goal of this agreement is to expand the use of dental lasers throughout DCA’s roster. Dr. Don Gallo, Chief Clinical Officer for DCA, states that “Biolase’s EpicX and Epic Hygiene lasers are the standard of care in the dental industry. We believe the adoption of this leading technology…will provide a new standard of care for our hygiene appointments while ensuring a safer environment.”
Zosano Pharma Corp.
Within the biotech and biopharmaceutical industry, there are plenty of unique markets. This includes medicines associated with treating migraines and similar ailments. Zosano Pharma Corp. is currently working on a wide range of therapeutics that can help support those suffering from migraines. This includes its most popular product known as Qtrypta. This substance is a formula comprised of zolmitriptan, that is showing efficacy in treating mild to severe migraines. Recently, the company has been working on resubmitting Qtrypta to the FDA for approval after an unsuccessful previous submission. This is quite common in the biotech industry as FDA regulations can be exceedingly difficult.
Steven Lo, CEO of Zosano states that “we have been working diligently to prepare the meeting package required at the time a Type A meeting request is submitted to the FDA. We are sharply focused on the resubmission of the NDA for Qtrypta and have been preparing strategies to address the comments received.”
While it may take some time before Qtrypta hits the shelves, milestones like these are important for investors to consider. Currently, Zosano is working to book a Type A meeting with the FDA to help gain insight into how it can get approval for Qtrypta. In the meantime, investors could view ZSAN as a penny stock to watch.
Are Penny Stocks Worth It?
I just wanted to give a few closing thoughts to those putting together a list of penny stocks to watch right now. Understand that price always plays a role. It’s the reason why people look for “penny stocks” in the first place. But also consider different trends in the market. BIOL, for instance experienced a huge move in a very short timeframe. More times than not, after such parabolic moves, one might assume that there could be some profit taking.
While this isn’t always the case, it would be prudent to have some idea in mind of where and when to take something off the table. Nothing moves up in a straight line forever. Also as the saying goes, “No one ever goes broke by taking profits”. But leave a comment below and let us know your thoughts on some of these penny stocks.