Penny stocks are a great way to make money in the stock market. They’re also helpful when it comes to leveraging smaller sums of capital with the potential to turn that into something much bigger. If you’re just getting started and learning how to day trade, for this article, we’re talking about stocks under $5.
AMC Entertainment (NYSE: AMC) is one of the most famous examples of what can happen when penny stocks explode. Despite shares taking a tumble this quarter, AMC stock is still up quite substantially, year-to-date. Believe it or not, the former penny stock kicked 2021 off at trading right around $2 a share. Fast-forward to this week, and not only had AMC reached record levels of $72.62, it’s still up more than 1,000%.
Are Penny Stocks Worth It?
When you’re looking at companies like AMC, the answer to the question, “Are penny stocks worth it,” may seem obvious. Bear in mind that there are plenty of risks involved, and in many cases, there are more penny stocks that ultimately deteriorate than explode thousands of percentage points. But if you understand how to trade, handle risk, and like making money quickly, then penny stocks can be well worth it. Today we’re looking at a handful of names trading for less than $4 right now. They’ve gained momentum and turned some heads recently as well.
Penny Stocks To Watch This Week
- Palatin Technologies (NYSE: PTN)
- TOMI Environmental Solutions (NASDAQ: TOMZ)
- Reliance Global Group (NASDAQ: RELI)
Palatin Technologies (NYSE: PTN)
If you’re on the hunt for biotech penny stocks to add to your list, Palatin Technologies might be a name you’ve come across before. The company develops treatment candidates addressing various medical conditions. Its current pipeline includes PL9654 in treating dry eye disease, PL8177 for ulcerative colitis, and Vyleesi for premenopausal women with acquired, generalized hypoactive sexual desire disorder.
Read more: Penny Stocks To Buy According To 5 Analysts With 55%-246% Targets
Both PL9654 and 8177 are clinical phase candidates and could be a point of interest heading into the new year. That’s because they have near-term potential catalysts to keep track of. In the case of PL9654, Palatin has commented that it expects to initiate a pivotal Phase 3 trial in dry eye disease patients in December 2021, with data coming next year. Furthermore, PL8177 has a Phase 2 trial beginning during the “first half” of next year.
In addition to the timing of these trials, speculative momentum has also become a factor thanks to new attention on vaccine stocks. That’s because the company announced last year that it would begin developing PL8177 as a potential treatment for COVID patients. With this as the latest head-turning catalysts, PTN could be one of the penny stocks to watch this week & heading into year-end.
TOMI Environmental Solutions (NASDAQ: TOMZ)
TOMI Environmental was one of the penny stocks discussed earlier this week. Short squeeze penny stocks have become a new topic of discussion among retail traders. As such, any stock with some short interest and/or low float intrigues some traders. As of this week, according to Fintel data, TOMZ stock shows a short float percentage of roughly 3%.
Most wouldn’t consider this a “massive short,” but there are other factors to account for. Fintel also shows that the borrow fee rate is relatively high and the “days to cover” is relatively low. TOMZ stock also has a total outstanding share count below 20 million, placing it among low float penny stocks.
Is there anything else to look at besides TOMZ’s short interest? Once again, the resurgence of virus fears could also play a role. TOMI specializes in disinfection and decontamination. Earlier this month, the company announced the launch of its SteraMist Amazon store to sell disinfectant products like its SteraPak and Binary Ionization Technology solutions. Commenting further on this, CEO Dr. Halden Shane explained, “As new pathogens emerge, including the new variant of SARS CoV-2 Omicron and the deadly C. auris fungus, continue to spread around the world, disinfection is deemed critical, and SteraMist is here to stop the spread.”
Reliance Global Group (NASDAQ: RELI)
We discussed Reliance Global in the same context as TOMZ stock earlier this week. However, in this case, RELI’s short float percentage is much more significant. According to Fintel, that figure is well above 30% right now.
Insurance stocks have been in and out of the retail trading spotlight recently. Reliance, in particular, specializes in wholesale and retail insurance agency development. It has amassed a portfolio of companies leveraging technology to personalize customer experiences. As we discussed yesterday, last week’s launch of its 5MinuteInsure platform brought the platform to a total of 20 states in the U.S., with a combined population of more than 100 million.
“We have added another 8 states to the 5MinuteInsure.com platform, and are now commercially available a total of 20-states across the U.S….We are also in advanced discussions with potentially significant acquisitions, building on our strong track record, which we believe could further expand our product offering and geographic reach.”
Ezra Beyman, CEO of Reliance Global Group
With plans for continued growth, RELI could be one of the penny stocks to watch right now.
What’s On Your List Of Penny Stocks Today?
Many people will associate “penny stocks” with shares of worthless companies trading on the OTC. But if you’ve read our articles for a while, you know that there’s much more to this world of low-priced stocks than that. As discussed in this article, many of the companies that fall into this niche are in their very early stages of development.
Read more: Penny Stocks Are Volatile, Here’s How to Trade Them and 3 to Watch
Since this is the case, it’s important to note that small developments can equate to significant reactions in the market. That goes for both positive and negative updates. These are just a few of the penny stocks that’ve gained attention recently and if they’re on your watch list, comment below on what you’re looking at with some of these companies.
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