4 Penny Stocks to Watch as Stimulus Checks Roll In
Markets were mixed at the open this morning, but it’s been a more bullish trend for penny stocks. In this case, let’s take a look at the Russell 2000 Small-Cap ETF (NYSE: IWM). As you’ll see, in tandem with other major indexes like the S&P 500 ETF (NYSE: SPY), both had pulled back during the early market hours. However, as the morning session rolled on, small-cap stocks began outpacing the S&P. This could be an indication of renewed interest in smaller companies in general.
Now that stimulus checks are rolling out, some expect younger traders to use the funds to pile into stocks. If one thing’s certain, it’s that retail traders aren’t shy about trading volatile stocks. So whether it’s been GameStop or any of the stocks under $5, we’ve found retail momentum fueling trends. One of these trends has been in small-cap technology and biotech stocks. I understand that many traders avoided broader tech stocks. This year has seen different trends take hold, with Robinhood traders flocking to certain small-cap names.
The Robinhood app has become one of the go-to’s for retail traders due to its ease of use. However, one thing to note about penny stocks on Robinhood is the majority of these stocks are only trading on the NASDAQ and NYSE. Is this a bad thing?
In my opinion, no, and let me explain why. When you’ve got OTC penny stocks, for instance, there are far fewer that have active trading consistently. There’s typically far more liquidity when it comes to listed penny stocks because more funds can trade them. With this in mind, here’s a quick list of penny stocks on Robinhood that have been turning heads this month.
Penny Stocks On Robinhood to Watch In March
- GT Biopharma Inc. (NASDAQ: GTBP)
- Evolving Systems Inc. (NASDAQ: EVOL)
- CNS Pharmaceuticals Inc. (NASDAQ: CNSP)
- Brickell Biotech Inc. (NASDAQ: BBI)
GT Biopharma Inc.
Shares of GT Biopharma have been on the move for the better part of the last few weeks. In fact, since the March 5th lows of $3.90, GTBP stock has managed to bounce back as much as 74%. This week the biotech penny stock reached highs of $6.80. This is a level it hadn’t been at since mid-February. What’s more, the last time it was trading at that level, GTBP stock was on heading lower.
One of the big catalysts recently has been the company’s clinical trial progress. This month, the company added the University of Wisconsin-Madison Carbone Cancer Center as another site for its ongoing Phase 1/2 trials. In particular, these trials are focused on GT’s lead candidate, GTB-3550, for treating cancer. The treatment is based on the company’s novel TriKE treatment platform utilizing natural killer cell protein to boost the immune system.
This week, the company updated interim results in the trial for high-risk myelodysplastic syndromes (MDS) and refractory/relapsed acute myeloid leukemia (AML). In total, 9 patients have been enrolled. According to the company, early data showed GTB-3550 therapy demonstrated “significant bone marrow blast level reductions” in AML and MDS patients without the need for expensive progenitor-derived or autologous/allogenic cell therapies.
“We believe as we continue to dose escalate GTB-3550 TriKE™, more patients will experience greater clinical efficacy. TriKE’s ability to work in the patient without outside supplemental engineered NK cells or the need for any combination drugs, sets TriKE apart from other cancer therapies. This is also the reason why TriKE™ therapy will be significantly less expensive than other treatments, opening the door to an off-the-shelf therapeutic.”Anthony Cataldo, the Chairman and Chief Executive Officer of GT Biopharma.
This platform has been a major point of focus in March. In addition to GTB-3550, its ROR1 TriKE for prostate cancer showed positive preclinical results as well. With strong progress in its current clinical trial and continued expansion of its TriKE platform, will GTBP be one of the penny stocks on Robinhood to watch?
Evolving Systems Inc.
One of the more interesting communications penny stocks is Evolving Systems Inc. Evolving Systems provides tools for communications service providers or CSPs. Through its range of platforms, EVOL allows its customers to engage and activate a larger customer base. This includes customer retention, additions, and more. Its platforms include enhancements for digital sales and distribution, real-time data, customer value management, and more.
As you can see, EVOL works almost like a tech company in this specific market. Its services are used by over 90 providers across 60 countries around the world. With a footing in this many countries, Evolving Systems is expanding its reach in individual markets.
On March 17th, EVOL announced its fourth quarter and year-end 2020 financial results. For the year, revenue came in at around $24.6 million. This is an increase of $0.6 million over the previous year. In addition to generating a positive cash flow, EVOL brought a positive EBITDA of $2.4 million for the year and $0.8 for the fourth quarter alone. This is substantial, and especially so considering the effects of the pandemic.
CEO of the company, Matthew Stecker, stated that “we have leveraged our ability to implement and provide support remotely and have noted a relatively limited effect on our operations during this time of a global pandemic. This has allowed us to overcome many challenges.” Stecker went on to state that the “Company has increased revenues and generated a profit for the year and for the fourth quarter.”
CNS Pharmaceuticals Inc.
CNS Pharmaceuticals is a biopharmaceutical company that is developing several novel therapeutics. This includes treatments for primary and metastatic brain cancers as well as CNS disorders. Currently, its leading product candidate is known as Berubicin. This is a treatment for glioblastoma multiforme or GBM. Currently, this type of cancer is considered to be incurable.
The substance was formerly studied in a Phase I trial by Reata Pharmaceuticals. It was then licensed by CNS Pharmaceuticals, which now holds an exclusive worldwide license on the chemical compound. Based on 11 patients, the drug showed a favorable response in 44% of candidates. This is highly encouraging, and now the company expects to start a Phase 2 trial this year.
Simultaneously, the drug is being studied in a Phase I trial in pediatric GBM patients in Poland. A few weeks ago, the company announced that it would begin enrolling patients in the Phase 2 study this month.
John Climaco, CEO of CNS, stated that “I am very pleased with our progress and the team’s execution towards the start of our program. We have made significant advancements and are now finalizing clinical site selection and preparing to begin patient screening, which we expect to commence next month.”
The company also presented at the Emerging Growth Virtual Conference on March 17th. So it will be interesting to see how the market takes to its recent developments and any new updates given at the conference.
Brickell Biotech Inc.
Brickell Biotech is a clinical-stage pharmaceutical company working on therapeutics for skin diseases. This includes a focus on using its lead asset, sofpironium bromide, for the treatment of hyperhidrosis. In a recent update, the company initiated a Phase 3 clinical program for this substance. On top of this, the company has also passed 50% enrollment in its upcoming Cardigan I and II studies. This could lead to an NDA submission to the FDA within the next year or so. On March 17th, two pieces of news concerning Brickell surfaced in the pre-market. Both are quite consequential for investors to consider.
On the one hand, fillings showed that Brickell Biotech has registered for a $50 million common stock offering. This is quite common amongst biotech companies, but it is always big news when it breaks. While the details of when are still unknown, it will be interesting to see what the funding goes towards. Second, the CEO of Brickell, Robert Brown, reportedly purchased 100,000 shares at an average price of $1.18 in a recent Form 4 Filing.
Obviously, a CEO buying shares in their company is usually a positive sign. It inspires confidence in the market. Additionally, bulls always like to see actions like this taken by a CEO. While this news is exciting, we also have to consider the speculative effects of such. For now, however, BBI stock has continued trending higher during the second half of the week.