Penny stocks are well-known for their potential to produce huge gains for traders. These high-risk, high-reward assets have polarized the retail market. You either love them or try to avoid them at all costs. High levels of volatility have opened doors for crushing drops in price and some of the most explosive gains seen in the stock market. Today, we look at one of the most volatile groupings of low-priced stocks, short interest stocks.
Penny Stocks To Watch
- Aterian, Inc. (NASDAQ: ATER)
- Alaunos Therapeutics Inc (NASDAQ: TCRT)
- Athersys Inc. (NASDAQ: ATHX)
Best Penny Stocks To Buy Now
Since penny stocks have this reputation, some traders decide to avoid research in exchange for treating small-, micro-, and nano-cap stocks like lottery tickets. It’s either an “all-in” or “all-out” situation and nothing in between. However, this is a misnomer, and those making money with penny stocks are using research and due diligence to their advantage.
One of the hot topics in the stock market recently involves stocks with high levels of short interest. The idea is that traders who short the stock must borrow shares to do so. When it comes time to make money shorting, they’ll repurchase the borrowed shares at a lower price and return them to their broker. It doesn’t matter if the price is higher or lower than where they originally shorted; they must repay the loan.
In a short squeeze, shorting goes wrong, and the traders who shorted the stock are forced to repurchase at much higher prices. This typically creates a snowball effect and sends bullish volatility into the market. AMC and GameStop are some of the well-known short squeezes in recent history. Will any of the names on this list of penny stocks become the next squeeze candidates?
1. Aterian, Inc. (NASDAQ: ATER)
eCommerce technology company Aterian has garnered plenty of interest from the same communities that rallied behind AMC and GME during the early days of the Ape movement. Its cloud platform is designed to leverage AI and machine learning with natural language processing for product management via online marketplaces.
It appears that ATER stock has been on the list of short squeeze names for weeks. A prospectus earlier this month brought some speculation on potential dilution. However, since that filing was released, ATER stock has remained bullish. Earlier this week, shares reached highs of $7.26 before pulling back to current levels just above $4. What’s more, around the time of that filing, we also identified some unusual options activity in the April Calls.
This week, ATER remains one of the short squeeze penny stocks to watch. Fintel.IO data shows the short float percentage on Aterian sits around 34.76%
2. Alaunos Therapeutics Inc (NASDAQ: TCRT)
Alaunos has been one of the penny stocks under constant pressure this year. The oncology company hasn’t been very vocal, which hasn’t helped sentiment much. However, of the little that has been released, the market does know a small bit of Alaunos’ outlook for now.
The company’s T-cell therapy platform is in focus, including Alaunos’ cancer mutation hotspot T-cell receptor (TCR-T) library. There are clinical and strategic collaborations in place with The University of Texas MD Anderson Cancer Center and the National Cancer Institute. Currently, Alaunos has a Phase 1/2 TCR-T library trial targeting different mutations in 6 solid tumor indications with the expected dosing of the first patient this quarter.
In a March update, Kevin S. Boyle, Sr., Chief Executive Officer, explained, “We are very pleased to announce that we’ve consented our first patient for treatment in our Phase 1/2 TCR-T Library trial at MD Anderson. We anticipate treating our first patient in the second quarter and will continue to focus in 2022 on generating meaningful clinical data.”
As details are limited, the market seems to have refocused on TCRT stock this week. Shares have recovered slightly from their recent $0.4101 lows. Meanwhile, short interest hunters may also be looking at TCRT stock’s short float percentage. Fintel data shows that figure sitting at 19.12%. Since this is one of the penny stocks under $1, volatility can play a much bigger role. If TCRT is on your list of short squeeze penny stocks, keep this in mind.
3. Athersys Inc. (NASDAQ: ATHX)
Shares of Athersys have followed a similar trend as TCRT up until recently. The penny stock made an explosive move on the 11th after months of selling pressure that took it well below the $0.50 level. No news nor filings came in tandem with the action. However, the market has zeroed in on the company’s late-stage treatment pipeline.
Athersys has provided updates on two clinical programs that evaluated its MultiStem cell therapy. It was licensed by HEALIOS K.K. and is being developed for ischemic stroke and acute respiratory distress syndrome in Japan. HEALIOS said that the final patient in its Phase 2/3 TREASURE study completed a 365-day follow-up visit.
“The last patient follow-up visit represents an important milestone in the TREASURE study, as it completes the collection of all patient data and enables the final validation of the data, analyses, and preparation of results by its contract research organization for unblinding and topline disclosures. Healios anticipates that it will receive the final topline results and make disclosures in May 2022,” explained the company in an April 4th PR.
Since May is right around the corner, speculation may have already begun fueling action in the market for ATHX stock. While it isn’t the highest on this list, ATHX short float percentage sits just over 10%, according to Fintel.
Short Squeeze Penny Stocks To Watch
This article is a continuation of our update earlier this week: Best Penny Stocks To Buy Now? 5 Short Squeeze Stocks To Watch. We discussed another round of stocks with high short interest, that traders were following closely. If you missed the article, click the link and read it in full. If you’re looking for the complete list of penny stocks making up the 8 to watch, reference the names below:
- Aterian, Inc. (NASDAQ: ATER)
- Alaunos Therapeutics Inc (NASDAQ: TCRT)
- Athersys Inc. (NASDAQ: ATHX)
- Creative Medical Technology Holdings Inc. (NASDAQ: CELZ)
- Clever Leaves Holdings Inc. (NASDAQ: CLVR)
- Enservco Corporation (NYSE: ENSV)
- Ion Geophysical Corporation (NYSE: IO)
- Cyren (NASDAQ: CYRN)
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