Penny Stocks Trading Higher As Stock Market Sell-Off Continues
There has been a brief reprieve from the 2022 stock market crash. The last few weeks of October opened the door for a bounce in the broader market. But continued uncertainty regarding inflation and recessions have kept most “big days” muted. Meanwhile, you’ve got a whole different set of stocks that are outperforming on a daily basis, and yes, I’m talking about penny stocks. This article looks at a handful of popular stocks under $5, making new intraday highs while the stock market trades lower.
Why The Stock Market Is Down Today
The stock market is down today thanks to continued concerns over controlling inflation. If you look at some of the events in the stock market this week, it might seem quiet. But with a speech from Treasury Secretary Yellen, on top of a closed FOMC meeting just before the lunch hour, tensions are high in the stock market today. As notable stocks like Apple and Amazon slip lower, there are plenty of hot penny stocks to watch that are making new intra-day highs.
Penny Stocks To Watch
- Enservco Corporation (NYSEAMERICAN: ENSV)
- Westport Fuel Systems (NASDAQ: WPRT)
- Spectrum Pharmaceuticals Inc. (NASDAQ: SPPI)
Enservco Corporation (NYSEAMERICAN: ENSV)
Energy stocks are heating up (no pun intended) as the industry constraints begin tightening in places like the EU. Natural gas prices are rising as temperatures cool, and related companies are benefiting. Enservco Corporation handles well-site services for onshore oil and gas clients, and on top of industry bullishness, ENSV stock has been on the move since reporting earnings.
Earlier this month, Enservco released its 2022 fiscal first quarter results. Earnings per share were up significantly at $0.27. That didn’t compare to the previous year’s loss per share of 24 cents. Revenue also beat estimates coming in at $8.6 million compared to the $6.79 million expected. It was also up 67% from its previous year’s quarter, where it did $5.1 million. That was due to an increase in customer demand thanks to higher commodity pricing.[READ MORE] Will Snap Inc. (SNAP) Be On Your List Of Penny Stocks In 2022?
Rich Murphy, Executive Chairman, also mentioned, “As previously announced, first quarter revenue showed significant improvement year over year due to increased customer demand and continued growth of our East Texas operation. We continue to believe the outlook for the oil and gas industry remains favorable, and we are excited about our growth prospects.”
Considering multiple catalysts at play, it’s no surprise to see ENSV stock trading higher. Industry-related news is important to watch now that earnings are in the rearview. In many cases, especially with energy, whatever happens with commodity prices can influence related stocks.
Westport Fuel Systems (NASDAQ: WPRT)
Fuel delivery systems company Westport Fuel is another one of the energy-related names on the radar in the stock market today. It provides delivery components for the clean energy segment of the industry—everything from natural gas, renewable natural gas, hydrogen, and propane fall under its umbrella. The backbone of its platform is a technology that enhances performance and fuel efficiency while mitigating the coinciding environmental impacts.
The company is due to release its next round of earnings on November 7th. In the meantime, analysts have begun weighing in. This week, RBC Capital initiated coverage on Westport with a Sector Perform, Speculative Risk. According to its latest report, analysts say Westport has a “compelling” technology, further emphasized by a price target of $2.50, nearly 200% higher than current prices.
As far as earnings expectations go, it will be interesting to see what happens. Westport is coming off of a weaker second quarter. In its last financial update, the company saw EPS drop significantly from $0.11 last year to a loss per share of 7 cents this year. Sales also missed analyst expectations.
Even RBC analysts mentioned that the current geopolitical tensions could impact Westport. In the same report referenced earlier, RBC also said, “Westport’s current business has been impacted by the Russia/Ukraine conflict, inflation, and unfavorable fuel price differentials, which is negatively affecting demand for its products and profit margins.”
Against the backdrop of a more robust energy sector in the stock market today, it will be interesting to see how investors react in the weeks leading up to the next round of earnings.
Spectrum Pharmaceuticals Inc. (NASDAQ: SPPI)
Spectrum Pharmaceuticals is one of the non-energy-related companies on this list of penny stocks. If the name is familiar, you were likely watching the company earlier this year, leading up to a significant announcement. Spectrum met with the FDA, which voted against the company’s lung cancer treatment, poziotinib. This sent shares tumbling to lows of $36 for the first time in its history.
Fast-forward a few weeks, and SPPI stock has found some footing between $0.40 and $0.50. One of the more recent catalysts that have helped it reclaim a small piece of what it lost was news last week regarding its ROLVEDON injections. The treatment designed to decrease the incidence of infection in patients with non-myeloid malignancies received FDA approval in September. The news highlighted that the treatment is now commercially available in a market that Spectrum estimates at $2 billion.[LEARN MORE] Using Volatility to Make Money With Penny Stocks
Back in September, Erin Miller, Senior Vice President, Sales & Marketing of Spectrum Pharmaceuticals, outlined the roll-out strategy for the commercial launch of ROLVEDON. She said, “Equipped with extensive long-acting growth factor market experience, customer connectivity, and learnings from in-depth market research insights, we are ready to optimize the launch trajectory. We expect to have product available in the fourth quarter of 2022 following the fulfillment of customary, pre-launch regulatory requirements.”
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