Are These Cheap Penny Stocks On Robinhood A Good Buy Right Now?
Millions of retail traders have come into the stock market over the last few years. But no other period saw such a large surge as the pandemic and post-pandemic periods. Where “traders of old” chose dynamic, desktop-first trading platforms, the new crop of millennial traders are focused on ease of use, access, and overall convenience.
In this case, mobile-first platforms like Webull and Robinhood have become the most popular. In fact, if you look at the penny stock brokerage growth over the last year, you’ll see that the overwhelming trend favors platforms like Robinhood. Despite its numerous shortcomings, millions of new traders have gotten comfortable with this type of trading technology.
One of the downsides, however, is with penny stocks. Specifically, OTC penny stocks (with few exceptions) are restricted on apps like these. With that, some of the cheapest stocks in the market aren’t accessible. If you’re looking for the “double zero” or “trip z” penny stocks to buy, you won’t find them on Robinhood or Webull.
But what you will find are the cheapest Nasdaq and NYSE traded names. But herein lies some additional risk. When listed penny stocks fall below $1, they fall victim to the exchanges delisting them. At the end of the day, if stocks remain below that threshold, they no longer meet the minimum requirements of the exchanges, and away they go either to the OTC or grey market.
Robinhood Penny Stocks To Buy [or avoid]
I’m not here to scare you into avoiding cheap penny stocks entirely. But it’s good to understand the risks involved outside of general market risk. In today’s article, we’ll look at some of the lower-priced penny stocks on Robinhood. Will they be worth the risk, or should you avoid them entirely?
- Globalstar, Inc. (NYSE:GSAT)
- ATIF Holdings Limited (NASDAQ:ATIF)
- Bright Scholar Education Holdings (NYSE:BEDU)
- BEST Inc. (NYSE:BEST)
1. Globalstar (NYSE:GSAT)
Despite the selling in the stock market today, there are still pockets of technology that are gaining ground right now. Globalstar is one of these tech stocks, and yes, if it’s familiar to you, you’ve probably read a lot about it on PennyStocks.com recently. Not only have shares experienced explosive growth over the last few weeks, but year-to-date GSAT stock is also up over 650% so far.
Read more: 3 Penny Stocks That Are ‘Must Watch’ Candidates in September
Recent excitement has stemmed from a speculative report on Globalstar and Apple (NASDAQ:AAPL). At the end of August, a report was released from MacRumors stating that the next iPhone from Apple will likely have satellite communications. This technology would allow users to make calls from places they do not have phone service.
Some have speculated that Globalstar will provide Satcom services to Apple. Bloomberg reported that its rival Iridium Communications wouldn’t be the provider, which is great news for the company. Bloomberg also reported that Apple is, in fact, making satellite capability aimed at allowing users to report emergencies in areas that do not have cell coverage. This continues to be the focus this week, and GSAT stock remains red hot. Needless to say, it’s still one of the “cheaper” penny stocks on Robinhood right now.
2. ATIF Holdings Limited (NASDAQ:ATIF)
Another one of the penny stocks on Robinhood under $5 is ATIF Holdings. The company has been a focus of traders searching for lower float stocks. Considering that ATIF shows less than 10 million shares outstanding, it could easily fall into this category. Late last month, we saw the stock effect a reverse split to remain above NASDAQ’s minimum price requirement. It’s something more frequently seen when you’ve got cheap stocks holding below the $1 threshold for a little too long. Regardless, since reversing, shares have been back on the upswing.
ATIF specializes in business consulting and asset management services for small and medium businesses. This summer, the focus was on launching its ATIF-1 hedge fund. Since gaining the first subscription from its Chairman, not much has been discussed. We can see from recent chatter that there’s a clear focus on low float and “short squeeze” stocks. Since ATIF meets at least one of these criteria, it could be a simple matter of technical trading potential that has the interest of retail traders right now. In that light, it could be something to keep in mind if ATIF stock is on your list right now.
3. Bright Scholar Education Holdings (NYSE:BEDU)
Another China-based penny stock to watch is Bright Scholar. Similar to ATIF, there hasn’t been much recent news from the company. However, online education technology companies have been a popular set of stocks to watch this quarter. In particular, Bright Scholar offers international education to global students. It also offers a Chinese government-mandated curriculum for students wishing to gain knowledge for higher education in China, specifically. With over 100 schools across 12 provinces in China and 8 schools abroad, the company continues providing K-12 academic services.
Read more: 5 Penny Stocks To Buy That Turned $2,500 Into Over $21,000 In 2021
Some concerns have arisen concerning China’s stance on for-profit education companies. Earlier this summer, Bright Scholar addressed these concerns head-on. The company explained that “Bright Scholar has very limited exposure to after-school tutoring from grade 1 through grade 9, and we currently do not expect that the abovementioned Opinion will have a material impact on our business.”
With renewed interest in Chinese education tech stocks recently, BEDU could be one that retail traders are watching heading into the middle of the month.
4. BEST Inc. (NYSE:BEST)
Sticking with “tech” in China, BEST Inc. comes on this list after weeks of focusing on “short squeeze” hunters in the market. The epic breakouts of former penny stocks like SPRT and BBIG have triggered a new trend involving heavily shorted stocks. In this case, BEST stock is in this category with short float data showing north of 30% right now.
There is more to the story than just a technical trend, however. BEST also recently reported earnings late last month. The company beat estimates on earnings per share during the quarter. It credited supply chain process stabilization as a contributing factor.
“Supply Chain Management achieved profitability by serving high-margin customers and expanding cloud OFCs network supported by smart logistic management for better operating efficiency.”
Johnny Chou, Founder, Chairman and Chief Executive Officer.
BEST doesn’t have the lowest float. But market momentum has clearly picked up. We’ll see how traders react as September goes into full swing.
Additional Thoughts On Penny Stocks
Penny stocks are high-risk and high-reward. As you’ve read, technical trends can have a larger impact than fundamental developments in many cases. In the stock market today, traders are after quick swings and big breakouts. But all of that comes at a price if you’re not experienced in trading that type of trend. So if you are looking for cheap penny stocks on Robinhood to buy, please make sure you know what you’re doing. Here are a few articles to check out that should help get you started:
