Penny stocks have a remarkable reputation for ridiculous gains. While these moves can come swiftly, retail traders tend to flock to the cheap stocks for their opportunity to capitalize on such an opportunity. Any given day, we see at least a few penny stocks surging hundreds of percentage points.
The vast majority ultimately pull back by the end of the session, but between ‘the bells,’ big money has been made. Unless you blindly trade without doing any research, understanding why specific penny stocks are moving is the first step in determining if there is a trade opportunity or not.
Things like penny stock news, industry-wide momentum, filings, and speculation play their part. Depending on the catalyst, you might be able to get a sense of how lasting an impact it could leave in the market. For example, stocks with pre-market news tend to do one of two things at the open.
They tend to either jump explosively higher or give back everything gained in the pre-market. In the instance of corporate filings, some traders don’t realize the specifics of something like a Form 4 or 8k until later in the session after the filing has had time to circulate.
Best Penny Stocks To Buy Now
If you’re looking for the best penny stocks to buy now, let’s set some ground rules. Are these the best stocks you want to trade today, or does the “best” relate more to investing in penny stocks for the long-term? Having a general understanding of the stock market strategy you want to use is critical to putting your list of penny stocks together.
Today we look at one of the most active penny stocks during premarket trading on Wednesday: Caladruus Biosciences Inc. (NASDAQ: CLBS). It has climbed as much as 65% from its April 26th close and is now testing levels above its 50-day moving average for the first time since last month. So why is CLBS stock up today, and is there potential to make money with penny stocks like it?
Why Is CLBS Stock Up Today?
Caladrius Biosciences develops therapies designed to “treat or reverse” diseases. Its cell therapy products include XOWNA (CLBS16) for treating coronary microvascular dysfunction. The company’s HONEDRA (in Japan), also referred to as CLBS12, is being developed to treat critical limb ischemia and Buerger’s disease. Its CLBS201 is a cell therapy candidate for treating diabetic kidney disease.
Earlier this month, the company announced that it is treating the first patients in a Phase 1b trial of CLBS201. Caladrius expects topline data by the first quarter of next year. Meanwhile, HONEDRA is seeking some clarity from the Pharmaceuticals and Medical Devices Agency in Japa for the best path forward. This clarity is anticipated this quarter.
Unfortunately, Caladrius hasn’t managed to sustain gains in the stock market over the last year. Shares have been in a perpetual downtrend for over a year. With sporadic single a multi-day pops in the market, it has been one of the top penny stocks to watch among retail day traders.
CLBS Stock News
In the stock market today, CLBS stock is on the move for a different reason. Along with Cend Therapeutics, the company announced that the two would merge. This merger is with a subsidiary of Caladrius via a merger of equals. As a result, the combined company will be renamed Lisata Therapeutics and trade under a new ticker symbol, LSTA. According to details of the April 27th update, the merge is expected to close next quarter.
“We believe that Cend’s technology has the potential to deliver novel and improved treatments in patients with solid tumor cancers with a lead program in pancreatic cancer that already has shown great promise based on early clinical data.”David J. Mazzo, PhD, President and CEO of Caladrius.
Cend’s lead product candidate, CEND-1, is being developed to treat solid tumors. It’s being evaluated in ongoing Phase 1 and Phase 2 trials by Cend and its Chinese partner, Qilu Pharmaceutical. Hepatocellular, gastric, and breast cancers are among the difficult to treat solid tumors being explored.
Should You Buy CLBS Stock?
Wednesday’s CLBS stock news has sparked an early move. Since the merger is likely pending until next quarter, it will be essential to follow details closely if this is on your list of penny stocks. Meanwhile, previous trends in this particular issuer have been more bearish than anything else. Will this news of a new company formation be the spark to inspire a reversal? That’s something you’ll need to determine. Based on management’s commentary on the deal, they appear optimistic about the new direction. So it will be interesting to see how that translates into the stock market today.