If you’re looking for penny stocks to buy, short-squeeze stocks have gained some appeal in the stock market today. One of the primary reasons for this is the potential that some of these types of stock hold for incredible breakouts – and breakdowns, for that matter. While short squeezes are higher-risk, in general, the ones related to some of the cheapest stocks can be those presenting the most significant potential for short-term, explosive moves.
If you look back at the recent rise of short-squeeze stocks, companies like AMC Entertainment (NYSE: AMC) and GameStop (NYSE: GME) come to mind. But those aren’t the only ones to have or will have experienced massive jumps in price within short periods. Even as recently as last quarter, we saw another company enter meme-stock status with AMTD Digital (NYSE: HKD).
Even though it wasn’t a penny stock, the thinly traded small-cap company experienced one of the wildest short squeezes since the AMC/GME saga began. As it began trading publicly, HKD stock hovered around $12. Days later, it would go on this epic ride, exploding to highs of over $2,550, equating to a move of more than 21,000%.
A word to the wise, not all short squeezes result in such moves—furthermore, not all stocks with high short interest squeeze. But with the right environment in place and potential catalysts to look for, the history of wild short squeezes over the last few years have given rise to this increasingly popular trend. How do you find short-squeeze stocks?
The first step is identifying high short interest. Today’s article looks at a handful of penny stocks that meet that initial criterion. We also look at any recent or upcoming milestones and events to determine if there are any other things to keep track of, should these be on your list of penny stocks to watch.
Short Squeeze Penny Stocks To Watch
Ambrx Biopharma (AMAM)
One of the biotech penny stocks that recently caught attention before the end of 2022 is Ambrx Biopharma. Initially, shares were trading below $1. However, after some early safety and efficacy data was released in a breast cancer treatment trial, the market took a much closer look. AMAM stock ultimately exploded to highs of nearly $5 within a single day following the update.
Fast-forward a few weeks, it’s still on one of the penny stocks Reddit, and Fintwit members are discussing. One of the most significant reasons for such optimism was that the encouraging data from its ARX788 platform demonstrated a 57.1% overall response rate and a 100% disease control rate.
“This preliminary safety and efficacy data in a heavily pretreated population further reinforces our view of the stability and precision underlying Ambrx’s proprietary drug-linker and site-specific conjugation technology for ADC design,” said Daniel O’Connor, Chief Executive Officer of Ambrx, in its December update.
– Are Penny Stocks Worth Buying in 2023? 3 Reasons
Amrbrx’s partner, NovoCodex Biopharmaceuticals, is conducting two Phase 3 studies and one registration-enabled Phase 2 study with ARX788 in China. There are also projected readouts anticipated for this year.
As far as AMAM stock and short interest are concerned, that figure is around 39%, according to Fintel.IO. Other outlets, including TDAmeritrade, have that slightly higher at roughly 49%.
Biora Therapeutics (BIOR)
Shares of biotechnology penny stock Biora Therapeutics caught some bullish momentum in the stock market this week. Following news that the company received pre-IND feedback from the FDA, there’s been a bit more optimism surrounding the company.
In headlines this week, Biora management explained, “The recent Type C response from the FDA further strengthens our confidence in our plans to enter the clinic during the first half of 2023 with IND filing followed by trial initiation in Q2, and data readouts anticipated in Q3…With this critical data anticipated during the phase 1 trial, we look forward to progressing a program that could have significant impact on patient care for ulcerative colitis.”
A day later, analyst coverage from HC Wainwright helped to continue this upbeat outlook in the stock market. The firm maintained its Buy rating on BIOR stock. It also adjusted its price target to $65. Considering this is still a penny stock, which trades around $3, HC Wainwright’s BIOR stock forecast target sits just over 20x higher.
What does the short interest data look like for Biora? According to Fintel.IO, the short float percentage on this penny stock is around 200%. However, other data sources, including TDAmeritrade, have that figure much lower, sitting around 5.6%.
Luminar Technologies (LAZR)
Thanks to the Consumer Electronics Show (CES) in Las Vegas this month, many tech stocks have gained some speculative attention. Luminar Technologies is one of the companies on that list, and so far, shares have continued rising this week. The company specializes in auto-tech targeting vehicle safety and autonomy.
At CES this month, Lumar hosted the North American debut of the Volvo EX90 and SAIC Rising Auto R7. The Volvo features Luminar’s Iris lidar, which is integrated into the roofline. The company said that “the all-electric SUV opened for pre-order on November 9 and will begin production in South Carolina later this year.” Luminar also unveiled a new software-based mapping product thanks, in part, to its recently closed acquisition of Civil Maps.
Commenting on the milestones, Founder and CEO Austin Russell explained, “2022 marked an inflection point for Luminar, as the first of its kind to move from R&D to production vehicles. Our big bet on production consumer vehicles and enhancing, not replacing, the driver is starting to pay off big time. I expect Luminar to make a sweeping impact in 2023 as the automotive industry continues to converge with our roadmap.”
– How Do You Analyze Penny Stocks? Start With These 5 Chart Patterns
Fintel data shows the LAZR stock short float percentage hovering around 22.58%. TDAmeritrade, on the other hand, shows this sitting at 23.07%.
List of Penny Stocks To Watch
- Ambrx Biopharma (NYSE:AMAM)
- Biora Therapeutics (NASDAQ:BIOR)
- Luminar Technologies (NASDAQ:LAZR)
