Are you looking for penny stocks to buy and wondering where to begin? You could hit the list of popular stocks with news. That may or may not give you a list of quality stocks. You could also look for technical signals, including penny stocks with high volume or irregular trading volatility. But something that many retail traders are using right now is known as alternative data.
This generally involves specific factors that don’t directly influence prices but could give clues about market sentiment. Things like insider trading activity, google search volumes, and even irregular Wikipedia page views fall into this category. In this article, we look at the options market and stocks experiencing an above-average surge in buying activity.
There is no guarantee that alternative data will translate into a meaningful move in stocks. However, it is worth noting when it comes time to build a watch list. The idea is if there is a higher-than-normal Call or Put buying, it could be a bullish or bearish signal. Will that be the case for this list of penny stocks today? I’ll leave that up to you to determine.
Penny Stocks TL;DR 30-Second Summary
- When looking for penny stocks to buy, traders can use popular stock lists or technical signals, but many are turning to alternative data.
- Alternative data includes factors that don’t directly impact prices but could give insights into market sentiment, such as insider trading activity, Google search volumes, and irregular Wikipedia page views.
- The article focuses on the options market and penny stocks that have experienced a surge in buying activity.
- While there is no guarantee that alternative data will lead to a significant move in stocks, it can be helpful in building a watch list.
- Higher-than-normal call or put buying can be seen as a bullish or bearish signal, but traders should do their own research to determine whether to invest in these penny stocks.
- Here are 4 penny stocks with unusual options activity today
Penny Stocks To Watch
Farfetch Ltd. (FTCH)
Shares of Farfetch were on our January list of penny stocks with unusual options activity. At the time, the Luxury fashion company’s shares rebounded back from 52-week lows that were hit at the end of 2022. Mixed earnings results and shakey customer growth have contributed to growing market concerns.
Fast forward to this week, and FTCH stock is hovering around levels where it began the new year. Solid earnings and some recent activity among analysts seem to have come back into focus. Farfetch beat revenue estimates for the fourth quarter of 2022 while also delivering a positive outlook amid a CFO transition. It expects a gross merchandise value of $4.9 billion this year, up from $4.23 billion in 2022.
“Farfetch enters 2023 as a significantly more efficient business following our strategic reorganization and cost rationalizations,” Chairman and Chief Executive Jose Neves said, explaining that the group has had a solid start to the year.
FTCH Stock Options Activity
A bit of near-term options action is going on in the March 17th expiration. But most of today’s activity can be seen in the January 19, 2024, $5 strike Calls. More than 7,300 contracts were traded compared to roughly 8,000 Open Interest. On top of that, for the same expiration, fewer than ten contracts traded, in total, across all Put contracts as of this article.
BigBear AI Holdings (BBAI)
Artificial intelligence companies have been on the radar thanks to ChatGPT. But this technology has long been a point of interest in the cryptocurrency and DeFi communities since its inception. BigBear AI provides analytics and cyber engineering solutions to myriad customers. Whether manufacturing, logistics, commercial, or even the U.S. Intelligence Community, BigBear AI’s platforms have rolled out to aid in successful, goal-oriented outcomes for its clients.
BigBear caught a lot of interest earlier this year when it announced a 10-year multiple-award contract with the U.S. Air Force. The multiple award $900 million “Indefinite Delivery/Indefinite Quantity” contract by the Air Force allows BigBear to compete for orders delivering everything from capabilities and systems to synthetic environments as a prime contractor.
BigBear will soon participate and collaborate with the U.S. Navy during International Maritime Exercise to advance efforts to integrate new unmanned technologies and AI. Through its Navy partnership, BigBear is looking to support the plans to build the world’s first unmanned surface vessel fleet by the end of this summer.
“Along with our Task Force 59 partners, we’re dedicated to building mission-ready capabilities at the tactical edge,” said Tony Barrett, President and General Manager of Federal Markets at BigBear.ai. “These opportunities allow us to showcase our strengths in building a robust data infrastructure that supports the development and enhancement of AI and ML technologies.”
BBAI Stock Options Activity
Regarding the BBAI stock options chain, it’s relatively quiet unless you look at the most near-term expiration date. In this case, the BBAI $2.50 Calls expiring March 17th have seen the highest level of volume in the stock market today, with nearly 2,000 contracts traded compared to 2,973 of open interest.
EOS Energy Enterprises (EOSE)
Last month, the energy storage platform developer provided a business update and provided revenue guidance. According to EOS, revenue was expected between $17 million and $20 million, with 2023’s outlook between $30 million and $50 million. EOS also reported receiving an order for a 47MWh initial renewables plus storage project “with one of the largest operators of energy storage in the US.”
The market officially got EOS Energy’s latest round of earnings at the end of February. The company reported a 2022 revenue of $17.9 million, which was 4x the revenue of its previous year. It also increased the opportunity pipeline by 83% year-over-year to $7.5 billion. Despite its growth, the Street was looking for more from EOS as the company missed sales expectations by a tight margin. The worse-than-expected results triggered a sell-off in the penny stock, returning it to the sub-$2 range.
Commenting on the outlook of EOS, CEO Joe Mastrangelo said, “Heading into 2023, we believe we are in one of the strongest positions in our company’s history as we continue to see a shift in the demand for longer-duration energy storage. The passage of the IRA and our progression through the DOE loan due diligence phase provides the growth catalysts to expand our increasingly commercially viable technology.”
EOSE Stock Options Activity
Despite the downbeat sentiment around earnings, the options market appears to have become more optimistic. In the stock market today, more than 5,500 $2.50 strike Call contracts hit the tape for the August 18th expiration. This volume was compared to fewer than 1,050 Open Interest contracts and fewer than 10 Put contracts traded, total, for the same expiration date.
Invitae Corp. (NVTA)
Recent 52-week lows may have inadvertently placed NVTA stock on traders’ watch lists this week. Mixed reactions over the latest round of earnings & financing agreements have aided Invitae’s slump. The medical genetics company beat estimates and reported a narrower adjusted loss last quarter. Invitae also expected revenue to top $500 million this year. Despite this, analysts anticipated the 2023 forecast to be slightly higher. Add to this an exchange and financing agreement with a fund managed by Deerfield Management Company and others, and NVTA stock has slumped over the last few weeks.
However, that isn’t the case this week, and the company is coming off several milestones, including its first commercial coverage. In particular, Invitae’s Personalized Cancer Monitoring assay helps detect minimal residual disease obtained its first commercial coverage in all solid tumors by Blue Shield of California.
Robert Nussbaum, M.D., chief medical officer at Invitae, also said, “We are continuing to generate additional clinical evidence as well as securing other reimbursement pathways. Overall, we are encouraged to see increasing access to MRD testing and view the coverage decision as a great step forward for patients.”
NVTA Stock Options Activity
The vast majority of today’s options volume is in NVTA stock’s June expiration, $2 strike Calls. More than 3,200 contracts traded compared to roughly 2,000 of Open Interest. Whether or not this translates to positivity in the stock is to be seen.
However, it is worth noting that Invitae issued the Notes and New Shares recently. The Notes were issued pursuant to an indenture between the company, the guarantor parties, and U.S. Bank Trust Company, National Association, as trustee and collateral agent.
Coincidentally, the Notes accrue interest at a rate of 4.5% per annum beginning on June 15, 2023. Whether or not that’s the catalyst for the action in the June contracts is speculative at this point.