Penny stocks are some of the highest risk types of stocks you can find. With that risk can come opportunity for big rewards, so it doesn’t hurt to search for trends that can help. Today, energy stocks seem to have gotten recharged after Enphase Energy (NASDAQ: ENPH) reported earnings. But there’s more to this than just an earnings beat.
Are Penny Stocks Worth It? – ENPH Case Study
Believe it or not, Enphase was a penny stock not that long ago. Even throughout the pandemic, it has managed to experience explosive gains. Anyone holding shares from the start of 2019 when it was still considered a penny stock is probably pretty happy. That’s because on January 2, 2019, ENPH stock traded under $5 a share. This week, ENPH stock hit new 2022 highs of $180.50 during early premarket trading on February 9th.
The energy technology company’s shares skyrocketed after it reported an earnings and sales beat for Q4 along with better than expected guidance. Enphase reported earnings per share of $0.73, 25.8% higher than the $0.58 per share expected. Meanwhile, the company anticipates sales for the first quarter of the year to be within a range of $420 million and $440 million. This was much higher than the $409.03 million the Street expected.
Since Enphase leans toward the green energy side of the industry, bullish sentiment has grown in related names. Today we look at a handful of energy penny stocks to watch after Enphase made a splash in the stock market today.
Energy Penny Stocks To Watch
- Gevo Inc. (NASDAQ: GEVO)
- FuelCell Energy (NASDAQ: FCEL)
- Uranium Energy Corp. (NYSE: UEC)
- Tellurian Inc. (NYSE: TELL)
Gevo Inc. (NASDAQ: GEVO)
Shares of Gevo Inc. have gotten come new life breathed in over the last few sessions. Thanks to upbeat sentiment on renewable and green energy as well as recent company milestones, Gevo is back in the conversation among retail traders. This is reminiscent of last year when GEVO stock exploded to highs of nearly $16. With the Biden Administration’s stance on alternative energy and green solutions, companies like Gevo shined.
GEVO stock is back in the limelight after Enphases made a splash today. Premarket trading sparked a move back above the $3.40 level for the first time since last Wednesday. One of February’s most significant points of focus is Gevo’s upcoming earnings results. The renewable energy company is set to report on February 24th, and after its Q3 results, the market is likely looking for some signs of progress.
In its last quarterly report, the company saw lower sales and a loss per share of $0.07. The significant developments in Q4, including a fuel supply agreement with Komar Americas Inc., will likely be in focus. This deal was for 45 million gallons per year of renewable, energy-dense liquid hydrocarbons. Gevo will produce these from its Net-Zero facility, Net-Zero 2, and the deal is expected to be valued at as much as $2.8 billion in gross revenue.
FuelCell Energy (NASDAQ: FCEL)
Like Gevo, FuelCell experienced its big move in early 2021 following mounting interest in alternative fuels and renewable energy stocks. The company provides decarbonizing power and hydrogen for use in its fuel cell platforms.
Since the end of January, FCEL stock has been on the rebound path, now jumped above $4.70 for the first time since mid-January. In its first sustainability report issued last week, the company reaffirmed its ESG commitments and discussed advancing its goal of achieving Net Zero emissions by the end of this decade.
“This inaugural Sustainability Report details the work we’re putting into a clean energy future and provides a baseline from which our stakeholders will measure the Company as we make progress toward our Net Zero 2030 initiatives, and ultimately the Scope Three emissions target by 2050,” said Jason Few, President and CEO, FuelCell Energy.
Now, eyes are on FuelCell’s Investor Day. March 16th marks when the company gives presentations and hosts Q&A sessions on corporate progress. Any new discussions of FuelCell’s investment strategy could also be on the docket. In a note late last year, analysts at Oppenheimer made comments highlighting this: “While we are encouraged by the company’s efforts to invest in its technology capabilities, especially given our view that commitments to net-zero infrastructure will accelerate, we remain on the sidelines awaiting execution progress.”
Uranium Energy Corp. (NYSE: UEC)
Shares of uranium company Uranium Energy Corp. have also gotten a jolt of momentum this week. Nuclear power has become somewhat of a focus for those looking at alternative energy companies. In particular, Uranium Energy is in the mining space providing raw materials for nuclear power production. It has two production-ready platforms in Texas and Wyoming, as well as ) a pipeline of resource-stage uranium projects in Arizona, Colorado, New Mexico, and Paraguay. The company also has physical holdings of uranium assets in U.S. warehouses.
This month has become an active one for the company. Uranium Energy reported becoming debt-free following repayment of a $10 million credit facility. Furthermore, it filed a Technical Report Summary disclosing mineral resources for its Reno Creek Project in Wyoming.
Details of the filing (S-K 1300) showed the project contains a measured resource of 12.92 million pounds of U3O8 in place. There’s also an indicated resource of 13.07 million pounds of U3O8 in-place and contains 1.49 million pounds of inferred mineral resources in-place. Since this project is in preconstruction phases and on standby mode, the market awaits Uranium Energy’s next move following this report.
Tellurian Inc. (NYSE: TELL)
Believe it or not, among the energy resources discussed, liquified natural gas (LNG) has been folded in. It is generally seen as a “bridge fuel” for constructing green energy projects. Tellurian’s model is built around delivering and developing natural gas projects, LNG trading, and natural gas delivery.
One of the more prominent points of focus for the market and the company has been on the construction of its Driftwood Liquified Natural Gas plant in Louisiana. As far as things stand, the company expects to start this project in April.
Another one of the things traders are watching is insider activity. With the planned start of the Driftwood project, it looks like some insiders are building up their position in the company. Heading into the end of January, Directors Jonathan Gross and Claire Harvey purchased 100,000 and 16,000 shares respectively. Average prices per share ranged from $2.8282 to $3.192.
Energy Penny Stocks In 2022
There’s a lot to look at when it comes to the energy industry. In 2022, whether you’re looking at traditional oil and gas or something like renewable energy, different cyclical trends can influence market moves. In this case, excitement stemming from ENPH stock’s explosive earnings catalyst has helped spark interest in related companies.
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