Do You Agree With Analysts On These Penny Stocks?
With the stock market sell-off this week, investors are jittery. But this hasn’t put a pause on day traders searching for penny stocks to buy. In fact, these last few days of selling have brought waves of retail buying. The name of the game right now is “bottom-feeding,” and rightfully so. If you look at broader exchanges and ETFs, including the S&P 500 (NYSE:SPY), Nasdaq (NASDAQ:QQQ), Dow (NYSE:DIA), and even the Russell 2000 (NYSE:IWM), you’ll see that these have tested some significant technical levels this week. All four broke below their 50-day moving averages. Furthermore, the SPY dropped below its 100-day average while the IWM dipped under its 200 day. For the SPY, it hasn’t made a move like this in over a year.
The Stock Market Today
With the Federal Reserve meeting coming to a close on Wednesday, eyes are now on Fed Chair Jerome Powell. What, if any, bond-buying taper schedule will be revealed? Will interest rates get hiked sooner than expected? Is inflation not as “transitory” as was initially believed? All of these questions are becoming a source of speculation in the stock market today.
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Then you’ve got the fate of China’s second-largest developer, China Evergrande, hanging in the balance. Will the country bail out the indebted real estate company? Do global financial institutions and governments step in to help? Again, more questions. In the stock market today, we’ve seen a pause to the rampant selling from earlier in the week ahead of the close of the FOMC meeting. As markets attempt to rebound, traders are looking for ways to buy the dip in beaten-down stocks. Today, we’ll look at five companies that analysts have shown interest in, along with price targets as high as 259%.
Penny Stocks To Buy [According To HC Wainwright]
Verastem Inc.
Verastem is one of the penny stocks we’ve discussed recently. This was thanks to upcoming data (at the time) concerning its Phase 1/2 FRAME study in VS-6766 for low-grade serous ovarian cancer. Since the details were revealed, VSTM stock has been climbing. The company reported that it saw positive data from the treatment study. When combined with the company’s defactinib, patients demonstrated meaningful response rates. Topline results are expected during the first half of next year.
If you look at VSTM stock in a longer-term timeframe, you’ll see that it’s still well off its 2021 high. Earlier this year, Verastem shares rallied as high as $4.93 on the heels of receiving Breakthrough Therapy Designation for VS-6766 with defactinib in this specific type of ovarian cancer. Its capital-raising efforts were one of the big reasons the stock came under pressure during the summer. But even with this pullback, some analysts are becoming more bullish right now.
VSTM Stock Forecast
Earlier this month, HC Wainwright analyst Sean Lee reiterated the firm’s Buy rating on the stock. Furthermore, Lee has a $5 target set right now. Compared to current trading levels of less than $3, that target is 71% higher right now. Next week, Verastem presents at the Cantor Virtual Global Healthcare Conference. So if VSTM stock is on your list right now, keep September 27th in mind as this is the date of that presentation.
Zynerba Pharmaceuticals
Another one of the penny stocks to buy, according to HC Wainwright, is ZYNE. The company specializes in transdermal cannabinoid therapies for rare and near-rare disorders.
September has been and will continue being a busy month for the company. Zynerba has made several key presentations this month on its ZYN002 platform, also trademarked Zygel. This product is administered as a transdermal gel to children with developmental and epileptic encephalopathy. Recent results of ongoing studies have demonstrated how Zygel can benefit patients even during longer-term time frames. In particular, patients with Autism Spectrum Disorder who completed a 38-week treatment showed “statistically significant improvements” compared to baselines in the study.
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While this progress has helped give some renewed bullishness to ZYNE stock, shares are still far from their 2021 highs of $6.07. But again, analysts are seeing a different picture right now.
ZYNE Stock Forecast
H.C. Wainwright analyst Oren Livnat recently reiterated the firm’s Buy rating on ZYNE stock this month. There’s also a price target of $9. Compared to current trading levels, that target is currently 104% higher right now. Similar to VSTM, if ZYNE stock is on your list, next week’s Cantor Conference will also be something to take note of. Zynerba will present as well.
Penny Stocks To Buy [According To Brookline Capital]: Dermata Therapeutics Inc.
While it’s just slightly outside of the penny stock range, Dermata has managed to make a strong move in the markets this week. The company recently went public in August at an IPO price of $7 but has pulled back since then. Does that mean all is lost for DRMA stock, or are trading going to buy the dip?
Something that has held interest for investors is the company’s therapeutic platform. In particular, Dermata specializes in skincare and, more specifically, managing medical and aesthetic skin conditions. The company is focused on advancing two programs in treating acne, psoriasis, and rosacea.
While it’s a new company, it hasn’t wasted time in bringing data to investors. In fact, Dermata is already setting up for a presentation at the November American Society for Dermatologic Surgery conference. The company will present Phase 1b proof of concept study data for its DMT410 treatment in multiple aesthetic skin conditions.
DRMA Stock Forecast
Despite the building excitement, DRMA stock hasn’t surpassed its IPO price of $7. If analysts are to be believed, however, that may not be a major hurdle. Brookline Capital is the latest to weigh in on the outlook for this biotech penny stock. The firm has a Buy rating on DRMA and a price target 156% higher than current levels ($14). Looking ahead, if DRMA stock is on your list, make sure to keep November 19-21st in mind. These are the dates of the upcoming conference.
Penny Stocks To Buy [According To BMO Capital]: 9 Meters Biopharma
9 Meters Biopharma is battling back to regain some ground lost over the last few months. This week, shares are trading at the same levels they were when analysts from BMO Capital weighed in. Given that as the case, some are beginning to follow this penny stock more closely. That also likely has to do with 9 Meters’ recent investor conference tour this month.
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The company specializes in gastroenterology and treatments for rare and unmet needs of patients. In its latest round of presentations, 9 Meters presented details on its current platform. It is now working on advancing its vurolenatide and larazotide treatment platforms for short bowel syndrome and celiac disease. The company’s also collaborating with the European Biomedical Research Institute of Salerno, Italy (EBRIS) for a planned Phase 2 study of larazotide in treating multisystem inflammatory syndrome in children resulting from COVID-19. Obviously, treatments involving COVID-19 have been a focus of the stock market this year. EBRIS plans to initiate Phase 2a trial in MIS-C in Q4 2021 at Massachusetts General Hospital for Children.
NMTR Stock Forecast
While recent progress may have become a highlight for traders, it hasn’t wholly managed to spark a rally back to 2021 highs. However, analysts at BMO Capital are a bit more bullish right now. The firm has an Outperform rating on the stock and a $5 price target, 259% higher than current trading levels. Furthermore, with an upcoming presentation at the Cantor Conference next week, September 28th could be an important date to keep in mind.
Should You Buy Penny Stocks?
Whether you believe analysts or not, the final decision is up to you when it comes to buying penny stocks. The one thing I can say about ratings and coverage from firms like these is that it can offer some added insight to fold into your due diligence process. At the very least, you can use it as another piece of your much bigger research process.
Stocks Discussed In This Article:
- Verastem Inc. (NASDAQ:VSTM)
- Zynerba Pharmaceuticals (NASDAQ:ZYNE)
- Dermata Therapeutics (NASDAQ:DRMA)
- 9 Meters Bipharma (NASDAQ:NMTR)
