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Today's (Wednesday's) top penny stocks come from a variety of sectors, including biotech, retail, financial services, and energy, and they are making gains for different reasons. These big movers do have one thing in common - today their investors cashed in big.
Penny stocks represent an inherently riskier investment option for investors. But with these risks in mind, be aware that not all penny stocks are created equal - some can be solid investments with wonderful upside potential.
Here are Wednesday's five top penny stocks, and why they're on the rise.
The Five Top Penny Stocks Today
- American Apparel Inc. (NYSEMKT: APP)
Last Wednesday, APP Founder, President, and Chief Executive Officer (CEO) Dov Charney was terminated by APP's board. He was accused of sexual harassment of the clothing retailer's employees and misuse of company funds. Charney owns a 27.2% stake in APP. Shares reacted positively to the news and gained more than 5%.
On Monday, the board hired an advisory firm for help raising capital. Then yesterday, Charney's attorney filed a petition for arbitration to potentially regain his stripped positions. That same trading session, APP stock tanked 21% to close at a two-month low of $0.53.
Today, American Apparel stock has rebounded with a 25.26% pop to $0.662 per share. Perhaps investors believe in the board's case against Charney to the point where they aren't threatened by the legal action. Or perhaps they believe the company can't get much worse, and want to cash in while the stock's at a discount.
- China Commercial Credit Inc. (Nasdaq: CCCR)
This microcredit company provides borrowed capital to the population in China that was previously barred from receiving financing, including farmers, small private entities, and other individuals.
Last Thursday, China Commercial reported Q1 2014 results of lower net income but higher revenue year over year. It has been making efforts to repay loans and bad debts, and combatting the issue of lending to an inexperienced population.
After dropping more than 40% over the past 12 months, perhaps CCCR stock is ready for a rebound. Shares are up 11.08% in the last five days, and on track for a 19.38% gain today to $3.65 per share.