There seems to be a disconnect between the broader markets and penny stocks. While this is typically the case, the stark differences are much more apparent this month. The S&P 500, Nasdaq, and Dow have all pulled back from highs, ending a multi-week rally before the big Jackson Hole meeting. This stalled or stagnant sentiment in the stock market today has led traders to hunt for alpha elsewhere. Higher volatility equities like penny stocks are the preferred flavor right now.
It isn’t Chunky Monkey or Cherry Garcia, but the massive gains from stocks under $5 have whet the appetites of short-term traders. Now, the search is on for another round of multi-bagger penny stocks to buy, thanks to big moves from meme stocks, including Bed Bath & Beyond, Blue Apron, and plenty of others over the last few weeks.
Best Penny Stocks to Buy Now
This article looks at a handful of penny stocks that can be bought for under $5. While volatility remains high, it will be important to determine if the risk is worth the potential reward. We look at recent events, technical trends, and more so you can make that determination for yourself.
- Vivakor Inc. (NASDAQ: VIVK)
- Lufax Holding LTD (NYSE: LU)
- Helius Medical Technologies (NASDAQ: HSDT)
- New Concept Energy Inc. (NYSEAMERICAN: GBR)
- Ring Energy Inc. (NYSEAMERICAN: REI)
Vivakor Inc. (NASDAQ: VIVK)
Shares of Vivakor surged in early morning trading on Tuesday thanks to an uptick in energy stocks. In particular, the company specializes in clean energy solutions, and a recent acquisition helped expand Vivakor’s portfolio.
The company closed the Silver Fuels Delhi and White Claw Colorado City purchase for $37.4 million. Matthew Nicosia, CEO and President of Vivakor explained, “The synergistic acquisitions of SFD and WCCC represent a momentous and transformative event for Vivakor and our valued shareholders. Given the long-term contracts presently in place at both SFD and WCCC, we expect to realize significant annual revenue and for both entities to generate meaningful EBITDA and profitability.”
With a float of fewer than 10 million shares and strong energy industry tailwinds, VIVK stock could be one to watch amid this rising energy stock trend. In addition, it will be interesting to see if the penny stock can break and hold above the 50-day moving average. That has been a level of resistance since early July.
Lufax Holding LTD (NYSE: LU)
Fintech company Lufax Holdings shares have been steadily recovering from a late Q3 sell-off that took the penny stock to lows of $3.84.The company offers personal financial services platforms in China and is a part of the Ping An Group, a larger financial services conglomerate. As the umbrella company, news from Ping An seems to have impacted shares of LU stock this week.
The company boasts more than 225 million retail customers and roughly y668 million internet users making it one of the larger financial service companies globally. This week, Ping announced results from the last year of business, which included steady growth. Profit grew, its customer base grew, and net profit rose. In its update, Ping also updated on the performance of Lufax, which it said: “continuously furthered its strategic transformation” with revenue growth of 8.4% year-over-year.
Right now, analysts remain cautiously optimistic about the company. This is based on recent updates from firms like Daiwa Securities and UBS. Both carry a Buy rating on LU stock and price targets ranging from $6.20 to $6.40.
Helius Medical Technologies (NASDAQ: HSDT)
Shares of Helius Medical also popped this week thanks to new market activity. In particular, Roth Capital initiated coverage on the medical technology stock, starting with a Buy rating and a $5 target. Helius is coming fresh from more robust earnings results for the second quarter. EPS and sales were both up over the last year. Meanwhile, significant milestones from its Portable Neuromodulation Stimulator were discussed in detail.
Portable Neuromodulation Stimulator or PoNS is Helius’ non-surgical medical device delivering electrical stimulation to the tongue’s surface. It’s indicated for use as a treatment for gait deficit from multiple sclerosis symptoms. The company fulfilled its first U.S. prescriptions of PoNS during the first quarter and made therapy training available in July. Helius is looking to roll out ePrescribing platforms through its network of licensed providers to open access to PoNS.
Expectations are high that Q3 will be even better. According to the company, it’s expecting Q3 revenue to be “modestly above” Q2 figures. It also anticipates future quarterly revenue growth sequentially through 2023.
The latest volume spike and leg higher toward its 50-day moving average could also be something to monitor.
New Concept Energy Inc. (NYSEAMERICAN: GBR)
One of the other cheap energy penny stocks to watch is New Concept. The company recently reported its second-quarter results, demonstrating year-over-year earnings per share and sales growth. It provides management services for oil and gas companies and owns real estate in West Virginia.
Second quarter operating results showed a jump in EPS from $0.01 last year to $0.02 during the same period this year. This is the second consecutive quarter that EPS has been positive, and sales figures have increased year-over-year.
While traders may hunt for energy stocks, they also look for low float names. GBR stock fits the mold with fewer than 10 million shares in the float. Given the momentum boost in the industry today, it could be one of the penny stocks to watch as long as the trend persists. In addition, the technicals support a more bullish tone as GBR stock has firmly broken and held above its 50-day moving average for the first time in months. That level has been a consistent level of resistance since April.
Ring Energy Inc. (NYSEAMERICAN: REI)
Speaking of flavors of the day, energy is becoming the focus. Ring Energy has continued a slow and steady uptrend since reaching 2022 lows of $2.19 in July. It has also bounced back thanks to its latest Q2 earnings beat announced in August. A $0.29 EPS and sales of $85 million came in much higher than expected.
Meanwhile, insider activity earlier in the month helped boost market sentiment. As we discussed in this article, 10% Owner William Kruse has been purchasing stock. How much has he bought? So far, Kruse’s purchases racked up more than 900,000 shares of REI stock at average prices around $2.66-$2.67. If you’re keeping score at home, that puts the trades at over $2.3 million. See more REI stock filings.
Meanwhile, the attention on short squeeze stocks has kept REI on the watch list. Fintel.IO and TDAmeritrade put the short float percentage around 21% as of this article. So if this is one of the names on your list of penny stocks with exposure to energy, keep that in mind.