If you’re looking for the best penny stocks to buy right now, there’s a lot of digging to do. That is if you’re not looking for extremely short-term moves in the market. The generally heightened level of volatility in the stock market today has made for a unique situation for traders and investors alike. In many cases, the retail side of the market is looking for new opportunities to capitalize on the “steep discounts,” as some suggest, based on the multiple months of selling pressure that has taken markets lower at the start of 2023.
Whether or not these are, in fact, discounts are yet to be seen. That is especially true when you’re talking about penny stocks. These sub-$5 equities are known for their high risk and high reward potential. Some underlying companies are still in their early growth phase, while others are long-standing companies falling on hard times.
You don’t need to look much further than some of the beaten-down regional bank stocks to watch. Several, including Silicon Valley Bank (OTC: SIVBQ) and Signature Bank (OTC: SBNY), have not only seen immense selling pressure, but the once-billion dollar companies are now trading for pennies on the Over-The-Counter exchange. Is there still an opportunity to make money with penny stocks like these?
I’ll leave that decision up to you. However, it is worth mentioning because it’s all part of the research process. Are some of the most active penny stocks today trading below $5 because the companies are growing, or is it because there’s trouble brewing? Furthermore, how will that translate to traders in the stock market?
Today, even some of the most beleaguered companies have seen sporadic upticks in momentum simply due to speculation. Today we discuss a handful of companies experiencing bullish momentum before the end of the week. Are they worth a closer look, and what, if anything, is going on that could be a source of such momentum? Let’s have a peak.
Penny Stocks To Watch
Nano Dimension Ltd. (NNDM)
Shares of Nano Dimension have been bullish overall since the start of the year. The trend hasn’t been as clear as some of the other companies rallying in 2023. However, since the beginning of the year, NNDM stock is up more than 15%, and this week has brought more optimism back to the market thanks to headlines.
Nano Dimension, an additively manufactured electronics company that also produces multi-dimensional polymer, metal, and ceramic 3D printers, has come into focus for several reasons. First, the company announced its latest round of earnings, which included an increase in Q4 sales to over $12 million from under $8 million in 2021. Furthermore, the company recorded over $43 million in revenue for the full year last year. According to the company, that is 1,200% higher than 2020’s revenue.
But that isn’t the only thing driving momentum in the stock market today. Nano Dimension sent an unsolicited non-binding indication of acquisition to Stratasys Ltd. (NASDAQ: SSYS). According to reports, Nano offered to purchase the 3D printing company for $19.55 per share in cash. This is an increase from its initial proposal to buy Stratasys for $18 per share earlier this month.
Commenting on Nano Dimension’s performance and the proposed transaction, CEO Yoav Stern explained, “We hope to accelerate our organic growth in the year ahead and remain well-positioned to execute on our M&A strategy – including our recently announced offer to acquire Stratasys Ltd. (“Stratasys”), which we view as a strategic, complementary asset in the relatively mature polymer-based AM market segment – within a flexible capital deployment framework. With the intensive help of our financial advisors, Greenhill and Lazard, in addition to our ongoing exchange with Stratasys, we continue building and pursuing our pipeline of additional prospective synergistic M&A transactions.”
Toro Corp. (TORO)
No, this isn’t the same Toro company as the turf and landscape company “Toro Company,” which trades under the ticker symbol NYSE: TTC. This is Toro Corp., a spin-off IPO of a familiar bulk shipping company, Castor Maritime (NASDAQ: CTRM).
Prior to the spin-off, Castor explained that “The transaction is expected to enable each of Castor and Toro to increase its focus on its respective line of businesses, enhance operational efficiencies, facilitate efficient strategic expansion, attract new investors, and, with this dividend distribution of Toro common shares, give Castor shareholders the flexibility to monetize or adjust their equity holdings according to the shipping sectors in which they want to invest.”
Since TORO stock made its public debut, it has been nothing but selling pressure until recently. Shares of the new IPO reached $26 on IPO day. Fast-forward to this month, and it reached fresh record lows of $1.42. Nevertheless, this week has seen a more bullish tone in the market as TORO stock attempts to reclaim some of its losses.
Shares have bounced back as high as $2.88 as retail traders shift focus to beaten-down penny stocks. Not much has been reported by the newly public company since its IPO, and some speculation on shipping stocks may be a reason for recent volatility.
Rent the Runway Inc. (RENT)
The penny stock caught a much-welcomed boost in trading activity on Thursday, with shares jumping over 13% during the morning session. For those unfamiliar, this fashion brand and “shared designer closet” company experienced a bullish start to the year that has since subsided in recent months.
In any case, Rent The Runway management has focused more on transforming the company. It announced plans to restructure corporate debt, including extending the maturity of its credit facility from October 2024 to October 2026. CEO Jennifer Hyman believes this extension paired with a reduction in cash interest, is “transformative” to the company’s business strategy and that it puts it in a better position to “reach our growth and profitability goals.”
Now the market awaits the next round of earnings to check in on progress. Rent the Runway plans to deliver the fourth quarter and fiscal year 2022 financial results on April 12th. As a recap from its last report, the company had better-than-expected Q3 sales results and issued higher-than-expected Q4 sales. With this backdrop, it will be interesting to see if speculation continues leading the charge heading into this next round of earnings for RENT stock.