5 Penny Stocks to Watch in February 2021
As we enter the second week of February, the time to find top penny stocks to watch is here. Right now, there are plenty of options for all types of traders. But before diving in head-first, it’s important to look at the market for trends. Let’s start with the current state of the pandemic.
In the past few weeks, daily case numbers have been trending down around the country. This is a big positive and could be due to several factors, including mask-wearing, vaccine distribution, and social distancing. While we aren’t out of the woods in any way, it does appear that things are getting better.
Next on the list is the large stimulus package. In the short term, this could have a very positive effect on the economy. However, in the long term, it could lead to an inflationary effect on the economy. With all of this considered, we now have to figure out the effects on various industries.
In the past few months, industries such as tech and biotechnology have risen steeply in value. But, we’ve also seen the rise of other industries that have been positively affected by the pandemic. With this in mind, we can begin crafting both short and long-term strategies. Here’s a list of penny stocks that have been trending recently and could be on the radar for February.
Penny Stocks to Watch For February 2021
- Zomedica Corp. (NYSE: ZOM)
- T2 Biosystems Inc. (NASDAQ: TTOO)
- Adamis Pharmaceuticals Corp. (NASDAQ: ADMP)
- Borr Drilling Ltd. (NYSE: BORR)
- Guardion Health Sciences Inc. (NASDAQ: GHSI)
Zomedica Corp.
One of the more sizable gainers of the day on February 8th is ZOM stock. Since November of last year, shares of ZOM stock have shot up by a staggering 3,357%. Although gains like this are usually relatively unsustainable, Zomedica does have a lot to offer investors.
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If you’re not familiar with ZOM, it is a veterinary health company working to meet otherwise unmet needs in the animal health industry. This includes a large range of diagnostic products aimed at treating various animal-related ailments. The company states that its goal is to provide veterinarians with the tools to increase productivity and efficiency in their treatment plans. A few weeks ago, the company announced that it reached an agreement with Miller Veterinary Supply to distribute its Truforma product.
In the agreement, Miller will provide distribution services for the Eastern United States. Robert Cohen, CEO of Zomedica stated that “we could not be happier about signing this distribution agreement with such a reputable and highly experienced organization. We believe that the principals of Miller share the same commitment to quality, customer service and value that we hope to be hallmarks of the Truforma line of products. We look forward to serving the veterinary community together as we introduce Truforma to the marketplace.”
Investors should keep in mind that ZOM stock is quite volatile. Also, factor in the massive move it made this week, alone. If this is on your list of penny stocks to watch, are you expecting a pull-back before new highs, or will ZOM continue higher?
T2 Biosystems Inc.
The healthcare diagnostics company has been working on new tests to identify Covid in humans. A few days ago, T2 announced that its testing panel could identify various new strains of coronavirus, such as the one that recently popped up in Brazil. Its test, known as the T2SARS-CoV-2 Panel, can identify a large range of covid strains, utilizing over 42,000 genome sequences from the coronavirus itself.
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In a recent test, this panel was able to identify almost 100% of all known covid strains. This is a breakthrough as there is plenty of unknowns currently at play with the coronavirus. Because testing is one of the major components of fighting the pandemic, T2 Biosystems could be in the spotlight right now.
The CEO of T2 Biosystems, John Sperzel, stated that “we continue to actively monitor new variants of the Covid-19 virus to confirm that our technology remains a useful and reliable diagnostic tool for the many healthcare systems and people that need it during this time.”
Of course, we have to consider the longer-term here, given that Covid hopefully won’t be around forever. In the foreseeable future, testing is extremely important. Additionally, one of the issues that we’ve seen with testing is the rate of inaccuracy among certain tests.
T2 Biosystems test reportedly has a 95% rate of correctly identifying the virus in people. Again, however, investors should consider the high volatility among these companies.
Adamis Pharmaceuticals Corp.
Next on the list of sizable gainers of the day is ADMP. Since mid-November, shares of Adamis are up by over 250%. As a coronavirus penny stock, Adamis Pharmaceuticals has received a great deal of attention in the past few months. The company is working on submitting an Investigational New Drug or IND to the FDA for its compound Tempol. Adamis thinks it could be an effective treatment for Covid-19.
Last June, it licensed the rights to Tempol from another biotech company. Since then, Adamis has been working on producing results that show Tempol could have efficacy in lowering the cytokine storm. For those who don’t know, this is an intense reaction from the body resulting from a large viral load.
The “cytokine storm,” as it’s referred to, produces a large immune response that often leads to hospitalization and other bad outcomes. In recent studies, Tempol has shown that it can reduce hypoxia, which is one of the symptoms that can lead to a cytokine storm in the body.
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While the company does have a large range of non-Covid compounds in its pipeline, right now, the focus seems to be on the potential benefits of Tempol. A few days ago, Adamis also announced the closing of a public offering for more than 46 million shares of common stock. At $1.11 per share, the gross proceeds should come in around $51 million. The company states that this funding will go toward general corporate purposes and further research on its substances.
Borr Drilling Ltd.
Borr Drilling Ltd. is a company that works in the oil and gas industry, providing offshore drilling services. This includes equipment for drilling across a large range of oil and gas operations. At the end of last year, the company stated that it had 27 jack-up drilling rigs and one semi-submersible rig. In the past few months, Borr has been working to bring in new funding and capital for its operations. A few weeks ago, the company announced an equity offering worth around $46 million total.
This offering will be made through the issuance of depository receipts. With any oil and gas company, capital raising is the most common way to increase growth in the short and long term. But, to look at Borr Drilling as a penny stock to watch, we have to examine the overall industry. When the virus hit early in 2020, energy penny stocks like Borr saw shares drop substantially. This makes sense given the lessened demand for energy due to travel restrictions and the widespread stay at home orders.
Now, a year or so later, we see energy demand begin to climb back up. Obviously, this is a slow and gradual process and may take some time before it reaches pre-covid levels. A lot of the demand for oil and gas depends on both case numbers and vaccine distribution. Case numbers in the U.S. are declining steadily. And, this trend of slowing the spread has continued for the past week or so. So to consider BORR stock as a penny stock to watch, investors should stay updated with the demand for oil and gas, in general.
Guardion Health Sciences Inc.
Finally, Guardion Health Sciences Inc. upheld its bullishness on Monday. After gapping up in the morning, shares of GHSI stock continued higher during the day. Though it’s still one of the “Robinhood penny stocks” trading below $1, the move it’s made in the last month has been substantial. On December 8th, the penny stock traded around $0.25; now, 4 weeks later, it’s up more than 200% so far.
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Much of the focus has been on the company’s ocular health products. Most recently, Guardion has been in contact with Ho Wah Genting Berhad, its Malaysian distributor, regarding its Astramern Astra H. The dietary supplement for immune support was granted product registration approval by the Malaysian National Pharmaceuticals Regulatory Agency.
“We have been advised that this product registration will allow HWGB to package both the Nutra V and Astra H products together to provide a complete immune support product offering to its customers. Importantly, this development helps to expand Guardion’s presence in the Asian nutraceutical market,” said Bret Scholtes, President, and CEO of Guardion.
With nutraceuticals and immune products becoming more popular, GHSI stock has gotten put into the mix. Now the question is, what comes next? If you sift through filings, you’ll see that Guardion has done a few rounds of capital raising in the past. Will this pose a potential dilution risk in the near term?
