Investors may find penny stocks under $1 an attractive option for trading. However, caution is critical when investing in these stocks. That’s simply because they come with inherent risks that can lead to significant losses if not approached carefully.
One of the main reasons why investors are drawn to penny stocks under $1 is their potential for significant gains. Such stocks are often associated with smaller, lesser-known companies that may experience rapid price fluctuations, offering high returns. Additionally, investing in penny stocks can diversify a portfolio and potentially yield rewards from high-performing stocks.
However, investing in penny stocks also comes with significant risks. These stocks are often associated with companies with limited financial resources or an unproven track record. As a result, careful research and due diligence are crucial to avoid scams or companies unlikely to succeed.
To find penny stocks to invest in, some will look for companies with a solid financial position and a clear growth strategy. Other investors prefer investing in companies operating in a niche market or offering a unique product or service that may not be widely popular. A good example is the latest trend in artificial intelligence stocks, or “AI stocks,” which have commanded attention. Even though this newfound popularity is apparent, the technology itself is not new, nor are companies working on advancing it.
Countless penny stocks and tech start-ups have worked on solutions over the last 20 years or more. Does that mean they were bad investments or just a little too early to the party? Regardless, not all low-priced stocks are created equal, making extensive research essential before making investment decisions.
How To Find Penny Stocks to Buy
There are several ways to find penny stocks to buy. Some methods include turning to financial news websites, investment forums, or using a stock screener. There are also more simple ideas like focusing on a specific price range. Nonetheless, conducting thorough research before making any investment decisions is important.
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Buying cheap stocks is entirely up to the individual. Evaluating specific investment goals and risk tolerance before doing anything else is important. Assuming you understand how to trade and invest, a good next step is putting together a list of penny stocks to watch.
Penny Stocks To Watch
Enservco Corp. (ENSV)
Shares of Enservco are trading higher at the beginning of the month thanks to strength in the oil and gas sector. Over the weekend, OPEC+ announced output cuts of about 1.16 million bpd, which sent the price of oil skyrocketing at the start of the week.
That isn’t all that is contributing to momentum in ENSV stock. The company reported its latest round of earnings at the end of March. Enservco’s Q4 revenue was up 59% compared to the previous year’s. It was also the seventh-consecutive quarter of year-over-year revenue growth.
In response to the results, Executive Chairman Rich Murphy appeared optimistic about the company’s prospects. “More recently, we further strengthened our balance sheet when Cross River Partners converted approximately $1.1 million in convertible debt to equity. Cross River expects to convert its remaining convertible notes in the amount of approximately $2.5 million, pending approval by stockholders at the upcoming June 13, 2023, Annual Meeting. This expected conversion would mark the end of our balance sheet restructuring effort that began in December 2019 when we had approximately $35 million in long-term debt, which we expect to be reduced to less than $6.5 million in mid-2023.”
Novo Integrated Sciences (NVOS)
NVOS stock has been on the radar for several months at this point. As we discussed in our article about NVOS stock in January, a proposed purchase agreement is where the focus could be for the market. An 8-K filing showed that the company entered into a purchase agreement with SwagCheck Inc. to buy that company and 100% of its outstanding shares “in exchange for $1.00.”
Fast-forward to last month, and a late-March update seems to have sparked attention on the company. Novo discussed current actions and events going on and gave the market a peak under the hood, so to speak. In particular, Novo explained, “Although the SWAG Agreement has not yet closed, the parties continue to work together with the intention of closing the transaction.”
This may have become a source of speculation as the market awaits an outcome of this process.
Nektar Therapeutics (NKTR)
Biotech penny stocks have been a somewhat hot topic of discussion lately, with many of the beaten-down names returning to focus. Nektar Therapeutics may be one of these companies after a recent spike in market activity helped prompt some attention from retail traders. Last week, NKTR stock popped with some of the highest volumes of the year just one day after hitting fresh 52-week lows.
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Nektar specializes in oncology and immunology treatment development. The company reported Phase 2 topline data for its rezpegaldesleukin lupus treatment candidate earlier this year. It was the source of heavy bearish sentiment causing the stock to drop significantly. Since then, the market seems to be looking for any further updates on more data. Though it did not meet the intended endpoints, management remains optimistic about its potential.
“We believe that these study results seen in the ISLAND study show that rezpegaldesleukin had a positive impact on disease activity in patients with moderately-to-severely active systemic lupus erythematosus,” said Brian L. Kotzin, M.D., Chief Medical Officer of Nektar. “These data also further support rezpegaldesleukin’s ability to expand regulatory T cells and the potential for this T regulatory cell stimulator to be used as a novel approach in the field of autoimmune disease.”
The company has a collaboration in place with Lilly to develop and potentially commercialize the treatment. Another Phase 2 study in a yet-to-be-announced autoimmune indication is outlined in the collaboration agreement, according to the company. With this as the backdrop and the noticeable uptick in activity, NKTR stock is on the watch list for some at the start of April.
List Of Penny Stocks Under $1
This article looks at another round of cheap stocks and continues the partial list of penny stocks from the article, “4 Hot Penny Stocks To Buy For Under $1 Right Now.“
- Enservco Corp. (NYSEAMERICAN: ENSV)
- Novo Integrated Sciences (NASDAQ: NVOS)
- Nektar Therapeutics (NASDAQ: NKTR)
- Cenntro Electric Group (NASDAQ: CENN)
- Safe & Green (NASDAQ: SGBX)
- Troika Media (NASDAQ: TRKA)
