Penny stocks are well-known for their high-risk profiles. But you also can’t ignore their potential for massive gains, either. Over the last few months, while the stock market crashed, plenty of stocks under $5 experienced explosive moves to as much as 1,000%+. Are those gains normal? No, but the fact that they’re possible is one of the biggest reasons day traders and swing traders have made a point to seek out the best penny stocks to buy.
Now that 2022 is into its second half, the focus is on economic data and its impact on the overall market. Even though the overreaching trends don’t typically influence smaller company stocks, they shouldn’t be ignored. Federal Reserve Presidents Bullard and Bostic spoke on Friday, giving their outlook on inflation and rate hikes.
In particular, the Fed’s Bullard said that inflation can come down quickly to 2% over the next 18 months if the Fed “plays its cards right.” Fed speak this week has helped lift spirits in the stock market, for what it’s worth. Today, we look at a few penny stocks to watch as broadly bullish trends have helped lift stocks.
Penny Stocks To Watch
Cemtrex Inc. (NASDAQ: CETX)
A recent trend in the stock market, today included, is one focusing on penny stocks under $1. According to the definition, penny stocks are shares of companies trading for less than $5. But for some thrill-seekers, only the cheapest stocks will do. Cemtrex fits this mold entirely.
This week, CETX stock caught one of the strongest surges of buying momentum it has seen in months. The technology company specializes in security, machine vision, AR/VR, and artificial intelligence. While no news was released since May, it hasn’t put a hold on traders buying up shares of the penny stock. By mid-morning, CETX stock has jumped over 40%.
One of the core points of focus for the company this year is centered around its security business, Vicon. Video surveillance and access control are in Vicon’s wheelhouse. As reopening continues, believe it or not, more office buildings and corporate headquarters are becoming the norm once again. In its fiscal Q2 update, management said, “During the quarter, Vicon received an upgrade order for $1.2 million from a large correctional facility and current customer, in Oregon that further validated its technology. We expect Vicon to move towards $5-10 million of recurring revenue in the next three to five years as the industry shifts to SaaS solutions leveraging AI and cloud technology solutions.”
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Meanwhile, Cemtrex has also looked to operational alternatives to build back shareholder value. In the same quarterly update, CEO Saagar Govil explained, “In conjunction with this new focus, we continue to evaluate a range of operational and financial alternatives, including the sale of one or more of the company’s business units. We are also taking steps to address rising costs by increasing prices and reducing overhead where possible.”
Clene Inc. (NASDAQ: CLNN)
A biotechnology penny stock to watch this wee is Clene Inc. Shares of the company have skyrocketed over the last few sessions thanks to news of reaching a significant milestone. Clene specializes in treating neurodegenerative diseases.
This week the company announced that its Clene Nanomedicine Inc. subsidiary reported “significantly improved” survival in ALS patients treated with its CNM-Au8 candidate. Rob Etherington, President, and CEO of Clene, said, “At this point, we are awaiting top-line data from the HEALEY ALS Platform Trial, which focuses on endpoints measuring patient function, survival, and breathing over a six-month period in a much larger cohort. Clene expects to announce these results this quarter.”
The exciting part is that the company said its optimistic about these upcoming results. This is “based on the larger number of patients treated in the HEALEY trial and the higher dose of CNM-Au8 being tested,” according to management.
OceanPal (NASDAQ: OP)
Another one of the trending penny stocks under $1 to watch right now is OceanPal. The company’s shares haven’t seen prices above $1 since March. Even before then, OP stock was a sub $1 name starting in late January. That hasn’t stopped traders from scooping up shares at the end of this week, as energy stocks have come back into focus.
OceanPal is a shipping company with a current fleet of 3 dry bulk vessels. Earlier this month, it announced entry into a time charter contract with ETG Commodities at a gross charter rate of $19,600 per day less 5% commissions. The contract period is 90 days and began at the start of the month.
Something of interest involves the materials OceanPal ships. Its vessels carry everything from iron ore and coal to grain and other materials. Given the global supply chain issues faced this year, shipping stocks have come back into focus recently. With more global economies beginning to reopen to trade, OP stock could be on the watchlist.
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Final Thoughts On Penny Stocks
High risk and high reward. That’s what you’ll run into when it comes to penny stocks. Whether you’re building a watch list or have already decided to buy, research is one of the most significant assets you’ll have. Even if it’s researching speculation or sentiment, having the understanding as to why certain penny stocks are moving the way they are can help give an edge when trading them.
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