There is extreme volatility in the stock market today, and it isn’t just with penny stocks. Investors are on edge thanks to the contagion spreading from last week’s Silicon Valley Bank implosion, this week’s continued banking industry woes, and concerns over what may come with next week’s Fed meeting. Will there be a stock market crash in 2023 like there was during the Great Recession and global financial crisis? On the flip side, are investors overreacting to headlines, or is it something in between?
This week we got more inflation data in the form of February CPI data and Wednesday’s PPI inflation report. Both showed that there is still room to go to curb costs. But with today’s PPI data coming in lighter than expected, hopes are that things will happen sooner than later.
That doesn’t seem to have lessened the wild swings in the stock market today, and likely won’t cool the trend this week. With many unknowns still up for debate ahead of next week’s rate decision and FOMC meeting, it’s open season for unpredictability in March. That has set the stage for things like penny stocks to shine.
These are stocks generally trading for less than $5 per share. They’re well-known for their volatility and tend to move independently of broader market trends. That makes them prime candidates for day traders right now. With that high potential for gains, there are also plenty of risks. The main risk here is the exact thing traders look at for opportunity: volatility.
As quickly as many of these stocks climb, they can implode, leaving uneducated traders holding the bag. That’s why having a strategy before jumping into trading penny stocks is critical (more on that later). This article looks at some of the most active stocks today trading under $5. We look at what’s acting as potential catalysts and identify anything worth noting down the road.
Penny Stocks to Watch
Agenus Inc. (AGEN)
The first quarter of 2023 has been rough for Agenus up until recently. Mixed reactions to clinical data for its colorectal cancer candidate, botensilimab, and worry regarding exposure to Silicon Valley Bank helped push AGEN stock lower. However, the latest earnings update and 2023 objective report seem to have brought back some much-needed bullishness to the market.
It wasn’t necessarily the financial performance that came into focus. It was management’s discussion on 2023 expectations. Garo Armen, Ph.D., Chairman, and Chief Executive Officer of Agenus, explained, “Our anchor programs, botensilimab (Fc-enhanced, multi-functional anti-CTLA-4) and balstilimab (anti-PD-1), show exciting potential in combination to treat a broad spectrum of treatment-resistant cancers…With the growing body of data demonstrating robust, consistent, and durable efficacy signals from a trial of over 300 patients across nine metastatic, late-line cancers, we are expediting the expansion of our botensilimab/balstilimab development program in MSS CRC and other priority indications.”
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Upcoming “catalysts for 2023” that were outlined include presenting additional data from a Phase 1/2 cohort at upcoming medical conferences, including the Society of Gynecologic Oncology, this month. There are also plans to continue enrollment in a phase 1b study for relapse/refractory NSCLC patients and to design a phase 3 study with the potential to launch later this year if response rates continue in the expanded Phase 1b study.
This week, analysts at EF Hutton reiterated a Buy rating on the biotech penny stock. The firm also maintains an $8.30 price target, more than 360% higher than current levels.
Hub Cyber Security Ltd. (HUBC)
Another one of the beaten-down penny stocks to watch this week is Hub Cyber Security. As the name suggests, the company provides cybersecurity solutions and services to its customers. Like most SPAC deals (Special Purpose Acquisition Company), shares have imploded since it combined with Mount Rainier Acquisition Corp.
Nevertheless, HUBC stock is on the radar this week following news that Israeli investment bank, A-Labs Advisory & Finance, reaffirmed its irrevocable commitment to investing $20 million in HUB at $10 per share. This was previously made in connection with its business combination.
Doron Cohen, Managing Director and CEO of A-Labs, commented: “We are intimately familiar with HUB and working closely with its management and board of directors over the past 18 months. A-Labs firmly believes in HUB’s potential to become one of the influential companies in the cyber arena over the next years and supports it future growth plans with this funding.”
Thanks to this vote of confidence, HUBC stock caught a nice boost in the stock market this week.
Protalix Biotherapeutics Inc. (PLX)
Biotech penny stocks are some of the most volatile; Protalix is an example. Even though it’s up overall, and in a big way since December last year, the day-to-day moves have been wild. You don’t have to look too far in the past to see what I’m talking about, either.
The company saw its shares drop at the end of last week from highs of around $2.20 to as low as $1.81. That trend continued at the start of the week as PLX stock slipped back down to $1.75. Since then, however, shares caught a bump in momentum thanks to news regarding no exposure to the SVB situation and general speculative trading in the penny stock.
That speculation has arisen from last year’s milestones. Late in 2022, the company announced FDA acceptance of a joint resubmission of an application for Fabry disease treatment. Protalix and Chiesi Global Rare Diseases announced the resubmitted and accepted Biologics License Application for PRX-102. Now all eyes are on the FDA’s next action date, May 9th, 2023.
This is the Prescription Drug User Fee Act or PDUFA date for the outcome of the BLA. Last month, the company said the European Medicines Agency’s Committee for Medicinal Products for Human Use adopted a positive opinion. It recommended marketing authorization for PRX–102 to treat adult patients with Fabry disease.
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Something to account for, however, is Protalix recently filed a prospectus to offer up to $20 million in a stock offering. While not much has been followed up on with that, some may be wondering if this presents a potential dilution risk for the penny stock.
List Of Penny Stocks
- Agenus Inc. (NASDAQ:AGEN)
- Hub Cyber Security Ltd. (NASDAQ:HUBC)
- Protalix Biotherapeutics Inc. (NYSEAMERICAN:PLX)