Are you looking for the best penny stocks to watch right now? With all of the excitement in the stock market today, you’re not alone. CPI inflation data from June came out this morning at it has struck a bullish chord with investors. The major market indexes tested fresh 2023 highs, with plenty of higher-priced stocks knocking on new records. That has helped spawn a tidal wave of momentum in cheap stocks. Why? Even the slightest move can equate to significant percentage changes in price.
What Are Penny Stocks?
Penny stocks are shares of companies that trade for less than $5. They typically involve smaller companies that are in their emerging or growth stages. Though they can also include companies that have fallen on hard times. There’ve been plenty of examples of well-known companies trading for pennies on the dollar that eventually rose from the ashes.
Just look at a company like Carvana (NYSE: CVNA). Last November we wrote an article titled Will Carvana Co. (CVNA) Be On Your List Of Penny Stocks In 2022? A few weeks later it actually broke below the $5 threshold and would eventually trade as low as $3.55. Analysts at Wedbush even downgraded the penny stock to Underperform and dropped their price target to $1. It became one of the household penny stocks to watch at the time, while the used car market and overall economy went through its trials. Fast-forward to this week and CVNA stock is trading more than 1,000% higher after reaching new 2023 highs of $39.94.
Instances like these are why traders continue to look for the best penny stocks to buy. Now, what does that mean today? With so much optimism stemming from positive CPI data, the risk-on trade is alive and well. In this article, we look at a handful of cheap stocks trading below $5 that the market is actively looking at. We take a peek at recent catalysts and anything else that may be attracting this attention. Then you can decide if they deserve a place on your list of penny stocks to watch.
Penny Stocks To Watch
- Vroom Inc. (NASDAQ: VRM)
- Aeglea Biotherapeutics Inc. (NASDAQ: AGLE)
- Ginkgo Bioworks Holdings Inc. (NYSE: DNA)
- Grab Holdings (NASDAQ: GRAB)
Vroom Inc. (VRM)
Shares of Vroom Inc. are racing higher after the company announced it would release its next round of financial results at the start of August. Sympathy sentiment has also played a role with companies like Vroom. Carvana’s epic rise has placed a focus on other companies within this space.
Vroom offers an eCommerce platform for buying an selling used vehicles. In its last quarterly update, the company posted an earnings beat but missed on sales by a wider margin. Tom Shortt, Chief Executive Officer of Vroom, said, “In the fourth quarter we continued to make progress on our three key objectives and four strategic initiatives. We significantly reduced operating expenses quarter over quarter and continued to improve our operations and customer experience. We improved our titling process enabling us to end the year with 87% of units available for sale or pending sale versus 52% at the end of Q3, however it also increased the age of our inventory available for sale and inventory sold.”
With growing anticipation, VRM stock has found itself a place on traders’ watch lists this month.
Aeglea Biotherapeutics Inc. (AGLE)
The biotech company tapped fresh 52-week lows of $0.1064 toward the end of June. However, the company recently revealed something that sparked a night-and-day difference (literally) in share price. Aeglea, specializing in enzyme therapeutics for rare metabolic diseases, announced a milestone acquisition.
It purchased Spyre Therapeutics, which holds a pipeline of candidates targeting inflammatory bowel disease. “The concurrent launch of Spyre and acquisition by Aeglea will provide immediate access to the public capital markets and the opportunity to accelerate research and development efforts for our broad pipeline of biologics,” said Cameron Turtle, DPhil, newly appointed Chief Operating Officer of Aeglea.
Following the update, this news sparked a massive move to highs of over $1 during the premarket session when the news came out. Now that the excitement has died down a bit and AGLE stock has pulled back, traders seem to have refocused on the company.
Ginkgo Bioworks Holdings Inc. (DNA)
We discussed Ginkgo Bioworks most recently in our article 3 Top Penny Stocks to Watch With Big News This Week, and it has been a sight to see. Shares continue higher in the stock market today with DNA stock testing levels not traded at since February.
In that article we talked about the comapny’s latest milestones. Its recent headlines focus on Ginkgo’s growth via new collaboration initiatives. A few weeks back, it announced its collaboration with Voodoo Scientific to push the production of “Smooth” spirits forward.
Voodoo will leverage Ginkgo’s enzymatic solution to offer distillers to produce premium spirit products. Further to this, the company also announced another milestone with Ambrosia Bio. The two companies are working on a way for Ambrosia to leverage Ginkgo’s enzyme services to develop scalable production of Ambrosia’s proprietary enzymes for converting feedstock to allulose. This is an FDA-approved rare sugar found in things like figs and raisins, to be used as a sweetener.
This week Ginkgo announced advancing its collaboration with Novo Nordisk on expression systems for pharmaceutical products. Jason Kelly, CEO and co-founder, Ginkgo Bioworks explained, “The next phase of this project will build on our existing microbial design, engineering, and phenotyping expertise while expanding Ginkgo’s capabilities in genome-scale design and engineering. We believe this work will enable us to support even more pharmaceutical products, helping to achieve better outcomes for patients.”
Grab Holdings (GRAB)
Grab is a “Super app” company. It focuses on the Southeast Asia market. It offers delivery, mobility, and digital financial services to its users. Grab began taking flight in May, thanks to headlines.
It announced a target to reach “zero packaging waste” by 2040. Many companies are working toward a more Environmental, Social & Governance (ESG) focus on appealing to specific groups of investors. To reach carbon neutrality, Grab reduced 48,000 tons of emissions in 2022. It also said that roughly 50% of its deliveries in Singapore are made via zero-emission modes of transport.
Despite a drop following earnings, GRAB stock has maintained much higher price levels since the beginning of June. Part of the excitement seems to have stemmed from a few different tailwinds, including strength in Asia-Pacific stocks. In addition, Grab also announced that its co-founder Tan Hooi Ling intends to step down this year. With the anticipation of fresh leadership, some speculatively bullish sentiment has grown in the stock market this quarter.