The definition of penny stocks is shares of companies trading below $5. But some of the most active traders in the stock market today focus on far cheaper issuers daily. Today we look at a few of the lowest-priced companies gaining attention. While there are many risks involved with stocks under $5, the cheaper you go, the greater the volatility risk you’ll encounter.
Then again, the greater the reward potential on even the slightest price change. One of the biggest problems traders have with penny stocks is some hang on too long or sell too early. Emotions aren’t easy to take out of the equation, especially when there are so many opportunities daily.
But if you’ve got a strategy in place, whether stocks breakout for days or minutes, you’ll be well-prepared. This is where today’s list of penny stocks begins. Are they top names to buy now? Should you avoid them entirely, or do they deserve a place on your penny stocks watch list while you decide?
Penny Stocks To Watch
NRx Pharmaceuticals (NASDAQ: NRXP)
Shares of NRx Pharmaceuticals exploded during Thursday’s mid-afternoon session. The biotech penny stock has been battling back after bad news in May. NRx announced the results of a review conducted by the Data Safety and Monitoring Board (DSMB). Accordingly, after review, the DSMB suggested a halt to NRx’s ZYESAMI® trial in critical COVID-19 patients.
However, even in light of this, management remained optimistic about its pipeline, namely NRX-101 in bipolar depression. The company is actively enrolling patients and expects to begin a Phase 2b/3 registrational study this year.
What To Watch With NRXP Stock
Shares of NRXP stock jumped on Thursday following a new public filing. In particular, a Form 4 was filed by Chief Scientist Jonathan Javitt showing the purchase of 100,000 shares of stock at a $0.58 average price.
Spectrum Pharmaceuticals (NASDAQ: SPPI)
Another one of the biotech penny stocks to watch is Spectrum Pharmaceuticals. The oncology company recently participated in HC Wainwright’s Global Investment conference at the end of May. It will likely be another conference event that has traders’ attention focused on SPPI stock.
Next week, Spectrum presents key data at the American Society of Clinical Oncology Annual Meeting (ASCO) on its poziotinib treatment candidate. Additional exploratory data from non-small cell lung cancer patients with a specific HER2 mutation were studied. Management has already explained that early data suggests that “reduction in ctDNA may be a predictor of response to treatment with poziotinib.”
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What To Watch With SPPI Stock
The company’s treatment is under review by the FDA with a PDUFA date of November 24th. It already received Fast Track designation and will likely be a point of interest on June 5th when the company presents. It’s also worth mentioning that Spectrum will attend other investor conferences this month on June 9th and 16th. So if SPPI is on your list of penny stocks, keep these in mind.
Epizyme Inc. (NASDAQ: EPZM)
Following fresh 52-week lows this week, Epizyme bounced back strong on Thursday. Despite the 1-day move only being about 7 cents, that equates to a move of roughly 17%. You might start to see the potential in penny stocks under $1. Regardless of this move, there are things that traders are focused on as to the future opportunities of Epizyme.
In particular, the company announced this week that there were updated safety and activity data from a Phase 1b safety run-in portion of a Phase 1b/3 study. The trial evaluates Epizyme’s tazemetostat combined with rituximab + lenalidomide (R2) in patients with relapsed/refractory follicular lymphoma.
What To Watch With EPZM Stock
The data showed continued improvement in objective and complete response rates, with the market reacting positively to the news. It’s also worth mentioning that Epizyme previously said in its quarterly business update that it plans on presenting this data at the ASCO meeting. Instead of next week, Epizyme presents during one of the weekend sessions on June 4th.
Trevena Inc. (NASDAQ: TRVN)
Shares of Trevena Inc. continued their recent uptrend in the stock market this week. The central nervous system treatment company has been climbing higher for the last few weeks, initially sparked by optimistic expectations from management. In its Q1 report, Trevena management explained that it is focused on advancing clinical studies for multiple pipeline candidates.
Its OLINVYK, for example, is expected to post topline data by the middle of the year. A study was designed to gauge possible changes in cognitive function in those treated with the drug compared to IV morphine. Meanwhile, the TRV045 platform in treating diabetic neuropathic pain is also being closely followed by some investors.
What To Watch With TRVN Stock
At the end of May, Trevena presented at the HC Wainwright Global Investment Conference, which resonated with traders. Since the event, shares of TRVN stock have climbed higher. Something to consider now is what happens next week. Trevena holds its annual general meeting. The company is requesting approval for additional authorized shares, which it says will result in no immediate dilution for stockholders.
“The increase in authorized shares is intended to provide flexibility to execute on the Company’s business development opportunities, achieve the $10M tranche from our R-Bridge financing, and advance the Company’s products and pipeline,” said the company in a May 11 update. In light of this, TRVN could be on the list of penny stocks to watch right now.
Trading Penny Stocks
Trading and investing in penny stocks can be rewarding if you know what to look for. You’ve got other things to account for when it comes to stocks under $1 or even penny stocks under $0.50. Aside from any manipulation risk or random news catalysts, price alone can become a contributing factor. As seen on this short list of penny stocks, just a few cents can equate to meaningful shifts in percentage value.