Penny Stocks To Watch This Month
The latest round of jobs data is out, and the stock market climbed as a result. But shortly after the opening bell, broad indexes pulled in. That wasn’t the case for all stocks, however. If you’re familiar with penny stocks, you know this type of trend is typical. Even when the stock market is down, plenty of cheap stocks are trading higher. The higher-than-average level of speculative trading compared to larger company stocks tends to spur pockets of bullishness.
This isn’t just bullishness from retail traders. It’s also coming from the analyst community. Believe it or not, some firms follow stocks under $5. They’re typically looking at the same things retail investors are: speculating on future potential based on current activity.
A very recent example of this is with popular meme stocks like AMTD IDEA Group (NYSE: AMTD) and its higher-price cohort AMTD Digital (NYSE: HKD). Both of the stocks saw explosive moves to the upside this week, with the majority of their moves coming on Thursday. However, Friday is a much different story, as the stocks have dropped significantly lower without apparent bearish catalysts.
Today we look at a few penny stocks the market is watching in January. Some of them have received attention from analysts. Others have experienced unusual trading activity following recent company milestones. The important thing to remember is that just because they’re moving “today” may not mean much “tomorrow,” as we’ve seen.
Penny Stocks To Watch
Amarin Corp. (AMRN)
Shares of Amarin Corp have been on our list of penny stocks to watch for a while. The company focuses on treatments for cardiovascular disease management and recently received regulatory approval in Switzerland for its VAZKEPA for reducing cardiovascular events.
The company will present at the JP Morgan Health Conference next week. Specifically, CEO Karim Mikhail is scheduled to participate in the conference on January 10th during the evening session.
What To Watch With AMRN Stock
Other than regulatory approvals and upcoming conference presentations, there are other things to keep track of if AMRN stock is on your watch list. Jefferies analysts recently upgraded the company. The firm’s analyst, Michael Yee, boosted his rating from Hold to Buy. Yee also raised a $1.30 price target by more than 100% to $3. Based on current trading levels of around $1.30, Yee’s target sits about 130% higher.
Oatly Group (OTLY)
One of the many household stocks that became penny stocks over the last year is Oatly Group. We discussed OTLY shares on our list of 40 other household names trading under $5. The alternative milk brand has seen its share prices implode since making its public debut. However, the last few weeks have been much more bullish as shares have rallied significantly since the final days of December.
One of the more recent developments for the company was a partnership with Graduate Hotels. Starting this month, Oatly becomes the brand standard oatmilk served at more than 20 Graduate Hotels properties. In response to the milestone announced last month, Michele Evans, Executive Vice President of Hospitality Graduate Hotels, “Our food and beverage concepts are the heart and soul of our properties, serving as gathering spaces for the community and a moment of connectivity for both students and travelers. We are constantly looking for ways to improve and strengthen the guest experience and we couldn’t think of better partners than Oatly.”
The news came just a few weeks before Oatly announced another food services-related deal this week. Along with Ya YA Foods, Oatly entered a long-term manufacturing partnership. This “hybrid” partnership will see Ya YA co-packaging Oatly products on-site at its U.S. facilities. Ya YA also acquires a majority of the assets used in the operation and assumes a lease at Oatly’s production facility in Utah. Oatly receives roughly $72 million plus additional credit toward future use of the shares assets at the Utah facility.
Something else to note outside of recent fundamental developments is some alternative data. Specifically, the OTLY stock options chain has seen an uptick in Open Interest in the January 20, 2023, Calls up through the $22.50 strike. Whether or not this is a factor is to be seen, but it might be something to note if OTLY is on your list of penny stocks to watch.
Ardelyx Inc. (ARDX)
Like Amarin, Ardelyx is another one of the penny stocks on watch lists for a while. Last month we discussed how FDA-related news sparked more attention on ARDX stock. Ardelyx reported that an FDA committee backed its kidney disease drug candidate. It also recommended its approval. The panel voted 10:2 in favor of combining the drug with phosphate binders. Ardelyx’s Xphozah is a standalone therapy for controlling serum phosphorus in chronic kidney disease patients on dialysis.
On top of that, Ardelyx closed out the year with more FDA news after it was granted an appeal for its Xphozah’s Complete Response letter for a New Drug Application.
CEO Mike Raab explained in a PR on December 29th, “By granting the appeal, we believe that OND has sent a powerful message regarding the importance of bringing innovation to the more than 400,000 patients on dialysis…This is a momentous day for Ardelyx and for all the members of the broader kidney disease community who have supported the development of XPHOZAH over the past ten years.”
Analysts at Citigroup also recently took a more bullish tone on the penny stock. The firm has a Buy rating on the stock and boosted its $6 price target to $7.