People enjoy penny stock trading for the hope of double or triple returns over a short time period. While some might not be at "traditional" penny stock prices, they have that same potential.
The U.S. Securities and Exchange Commission defines penny stocks as stocks trading under $5. But that doesn't mean stocks trading a little over $5 can't have huge upside potential.
One of our best penny stocks to buy now trades above $8 but could still gain 101% very soon.
Clearly, stocks trading in the single digits can make massive percentage leaps – $5 is not a magic number. Many of these stocks suffer the same institutional neglect that impacts penny stocks and have the potential for massive gains.
Another one of our favorite low-priced stocks today is a closed-end fund that invests in undervalued stocks. The fund managers purchased many of these stocks for less than $5. And a quick look at the portfolio shows that the fund has purchased pretty much all of its holdings for less than $10 a share.
We'll start with that one. Then we'll show you our 101% gainer further down.
180 Degree Capital Corp. (NASDAQ: TURN) takes an activist approach to investing in microcap stocks. It engages management in companies that it owns to agitate for change. Like many activists, it uses letters to the board of directors and shareholders as a weapon in the fight for change.
It's not shy in its comments.
Earlier this year, it sent a letter to the board of portfolio holding Enzo Biochem Inc. (NYSE: ENZ) that said, "You clearly have no respect for the will of your shareholders who are the true owners of this company. You also appear to have no idea of what we believe is your role as board members and what the word accountability means."
The firm originally had private equity investments but has been pivoting toward the equity activist approach. Since the current managers took over at the end of 2016, 180 Degree has outperformed its benchmark Russell 2000 index by more than 4 to 1.
Shares of the fund were up more than 25% in the first quarter of 2021.
The fund is structured as a closed-end fund. Since it's a fairly small fund, it's off most investors' radar screens. As a result, the shares trade at a 20% discount to the net asset value.
That gives you two ways to make money. The undervalued stocks in the fund can go up thanks to the activism of 180 Degree Capital. Then, the discount can narrow as investors become aware of the fund's outstanding performance.
Shares of 180 Degree Capital trade for $8.08 today. But you can get this next "penny stock" for even a little less…
One of the lessons learned in 2020 was that we need to improve our supply chain dramatically. Radiant Logistics Inc. (NYSE: RLGT) will be part of developing that solution.
Radiant offers global supply chain services, including domestic and international air and ocean freight forwarding. It offers truckload, less-than-truckload, and intermodal freight brokerage services.
If it involves getting products from point A to point B efficiently and quickly, Radiant is part of the solution.
Radiant runs an asset-lite logistics platform. It does not own any trains or ships. Instead, it works through a network of carriers and freight brokers to help shippers get their product where it needs to be when it needs to be there.
Radiant has posted four consecutive massive positive earnings surprises. As a result, analysts have been raising their targets for both 2021 and 2022.
In the most recent quarter, Radiant reported record revenue and cash flows. Profit margins were also at all-time highs.
Management has said that it would be using cash flows to buy back stock and look for acquisition targets that add value to the business. Both of those could help drive substantial profit per share gains and boost the stock price.
Over the next five years, it expects earnings to grow at an eye-popping 24% annually. That type of performance could easily drive the stock to gains of 400% or more.
Finally, let's show you the top penny stock that analysts agree could soar 101% in a few months…
Alpha Pro Tech Ltd. (NYSE: APT) is a Canadian company operating in two seemingly different businesses. What they have in common are extraordinary tailwinds that could drive profits and the stock price a lot higher than they are today.
Alpha Pro Tech started in 1996 as a company making face shields. Its lineup of protection equipment has grown to include N95 facemasks, gowns, shoe coverings, hair caps, lab coats, and medical scrubs.
The other line of business, which it started in 2005, includes a line of construction weatherization products, namely house wrap and synthetic roof underlayment.
The global pandemic was a boost for the protective gear business. When it ends, we will still have a much more conscious society of the possibility of a pandemic, so profits like the N95 masks will likely remain in high demand.
There will always be steady demand from hospitals, research clinics, biotechnology companies, and pharmaceutical concerns. Non-medical demand will come from semiconductor companies, medical and dental product distributors. Construction and roofing distributors want these products as well.
We're still far short of the number of new homes expected to be built for the growing demand in the United States. There will also be demand from the re-roofing market, as many homeowners will be discouraged from selling their home due to the high cost of replacing it. They will decide to stay and fix up the old house, which will often include a new roof.
Alpha Pro has no debt and is producing lots of free cash flow. Much of that cash flow is going to buy back stock.
Alpha Pro Tech still has more than 2 million shares to buy under the current repurchase plan.
This stock trades for about five times earnings. Continued earnings growth and multiple expansions could drive shares of Alpha Protect to three times or more than the current stock price.
Right now, bullish analysts are calling for this stock to hit $16.75 within the year, a 101% target from today's $8.30.
Penny stocks are shares of stock that trade for under $5. With shares under $5, penny stocks typically have a higher level of volatility, but they also have a higher potential for reward.
Historically, penny stocks traded for less than $1 per share. The Securities and Exchange Commission (SEC) modified the definition to include all shares selling below $5.
While penny stocks sell for under $5, you still might have to put more than $5 in your account if you're just getting started, as brokers often have different account minimums. It's worth investigating broker fees and avoiding offshore brokers altogether if you're just getting started investing.
Penny stocks carry a higher risk than regular stocks. These cheap stocks are great trading vehicles but are not generally considered long-term investments. (Of course, there are always exceptions.)
While some penny stocks trade on large exchanges such as the NASDAQ or NYSE, most do not. Some penny stocks trade OTC (over the counter). OTC are how stocks trade when they aren't listed on a major exchange like NASDAQ or NYSE. This is typically where smaller companies trade when they can't meet listing requirements of a bigger exchange, like having a certain number of publicly traded shares and a certain minimum price per share.
The cons of trading stocks OTC is that they tend to have low volume, so you might not be able to get the sale price you want when you go to sell – or worse, not be able to sell at all.
Something else to watch out for is when stocks are known as "Pink Sheet listings." These are stocks that have the least regulatory oversight and liquidity. They are not required to file financial information with the SEC, so investors don't always know exactly what they're buying. This can make these companies less reliable as investments than those that have traded for years on a regulated exchange.
Because penny stocks tend to be volatile, and because the companies that list penny stocks frequently do not file with the SEC, investor research and due diligence is important. It's also typically recommended to focus on penny stocks that are listed on a major exchange.
Research will help you choose which penny stocks to watch as potential "buys" to help investors meet their profit goals. When looking at penny stocks, there are several pieces of valuable information that can help.
Investors should first be familiar with the market sector that a penny stock is in as well as the industry of the company.
Investors should examine press releases and a company's announcements. These documents can provide information about new contracts, positive earnings, or, in the case of biotech, news of test results, and can forecast potential gains. This can help investors spot companies that are just formed or might be heading for bankruptcy.
Another way to research penny stocks is to look for big percent gainers. Penny stocks that are on the move are penny stocks to watch this week. And a long-term chart with the historical information of a penny stock's performance can tell you if a stock has been climbing steadily higher or been extremely volatile.
Stock liquidity is also important. Because penny stocks are usually associated with small companies and infrequent trading, they may have a lack of ready buyers in the marketplace. A lack of ready buyers means that selling stock can be difficult, and lowers the liquidity of the shares. Investors should look at a penny stock's volume to make sure there's enough daily activity should they want to sell their shares. They should also make sure that the price of the shares accurately reflects the market. A high price with not much volume is a warning sign.
Different industries thrive under different economic conditions. When deciding which penny stock to buy, an investor might consider if the current economic environment benefits the company's industry.
For example, penny stocks to buy now are in industries like e-learning, food delivery, tech and biotech because of the global pandemic. Tech companies are creating innovative solutions to current problems, such as how to enable employees to work more effectively from home, and these companies may be developing the next solution for remote collaboration.
Follow Money Morning for continued info on how to successfully trade penny stocks, understand the process, and get lists of penny stocks to buy this week. Also, you may want to consider the best cheap stocks right now. And if you're new to investing, we can teach you how to buy your first stocks. There's lots of information on our site and in our newsletters beyond penny stocks that will explode!
When a stock - whether it's $20 or $2,000 - is about to experience a breakout, it always exhibits three specific signs at the same time: a shift in momentum, technical trends, and volume.
And since low-dollar stocks have a higher tendency to move towards the upside, our Chris Johnson's showing you two micro-cap stocks that fulfill the above criteria, as well as where to buy in for the most potential profits.
When a stock - whether it's $20 or $2,000 - is about to experience a breakout, it always exhibits three specific signs at the same time: a shift in momentum, technical trends, and volume.
And since low-dollar stocks have a higher tendency to move towards the upside, our Chris Johnson's showing you two micro-cap stocks that fulfill the above criteria, as well as where to buy in for the most potential profits.
Cheap stocks offer the possibility of spectacular profits in a short time.
But you have to know where to look.
Institutions sometimes fail at this - and it can work to your advantage.
They best cheap stocks today have fallen to to prices that scream "buy" when you look at their fundamentals.
And the fact that the smart money hasn't yet caught on could mean huge gains later.
Buying penny stocks on the verge of new 52-week highs continues to be a winning approach.
The 2021 stock market has been hot, with the Dow Jones Industrial Average at an all-time-high of 34,900.
A rising tide raises all ships.
But the best penny stocks to buy now could rise even higher.
Because penny stocks trade at such low prices - under $5, as the Security and Exchange Commission defines it - they can pop higher percentages than most stocks.
These top penny stocks happen to be part of the biggest broad market trends happening today.
So, they're all hitting new 52-week highs. Of course, you sometimes want to avoid stocks that just popped big and fast, in case they slide back down just as quickly.
But there's a good case for these penny stocks blowing beyond penny stock prices and staying there.
Cheap stocks continue to be the land of opportunity for aggressive investors.
We are seeing an opportunity for massive profits in stocks under $10 a share.
Best of all, many of these solid companies are also trading at single-digit price-to-earnings ratio.
Cheap stocks are more than just a low share price.
They're stocks trading at super low valuations too.
A solid business combined with sneakily great valuations are the perfect recipe for making money in any markets.
It just so happens we're in a red hot market where low priced stocks could double or triple in price in a matter of days once investors get hold of them.
Here are the best cheap stocks to buy right now...
Doubling your money is rare if you blindly choose any penny stock from the shelf.
But you can better your chances by looking at cheap stocks with high earnings expectations.
Everyone from Peter Lynch to Warren Buffett has said that, at the end of they day, earnings growth that drives stocks price.
Markets sold off violently this week as the full scale of inflation fears began to sink in.
Though stocks managed to catch a break on Thursday, the gains were not evenly spread out across indexes.
But a permanent state of volatility seems to be the new normal, and while this spells trouble for the short-term trend, especially Big Tech, Chris isn't worried.
In fact, his chart shows a technical situation unfolding here that'll likely send one small stock soaring 50% or more..
One simple way to avoid losses penny stock investing is to make sure you don't buy into companies that risk shuttering in the near term.
Sure, everybody wants big short-term gains.
But the best penny stocks to buy will have even more value to sustain them for a lifetime.
We will show you a few of those today.
Last Friday's jobs report has brought out a lot of optimism among investors.
If this incredible amount of job creation continues all summer long, we will have added close to 10 million jobs back to the economy by fall.
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This is great news for our best penny stocks to buy now...
One of the best penny stocks to buy, Gogo Inc.
(NASDAQ: GOGO) banked some traders 360% profits as the company made breakthroughs in the airline wi-fi business.
The stock went from $2.91 to a peak of $13.40 in less than 6 months.
Today, we're going to uncover the next massive growth opportunity in penny stocks.
A great way to catch penny stocks before they double or triple is to watch for insider buying.
Imagine you're CEO of a company.
You probably own a lot of shares in that company.
That means, if the stock rises, you're looking at a sweet gain.
But what could prompt you to buy even more of the stock?
These executives expect great things to happen for the company and the stock, so they want the only thing that makes sense when you expect huge profits - more shares.
Interest in penny stocks exploded last year during the lockdown and has continued even with the end of the pandemic in sight.
Especially now that the economy is opening up, the best penny stocks are ready to ride another broad market bull run.
Investing in clinical stage biotech companies can lead to unimaginable profits.
In fact, one of these penny stocks from the biotech sector has a chance at 130% growth.
Our best penny stocks today are about to get a $1.9 trillion catalyst this month that could double their share prices.
Congress is about to inject another $1.9 trillion into the economy, including $1,400 stimulus checks, and low-priced stocks are primed to be the big winners of the cash injection.
We saw a surge of cash when the $600 stimulus checks were mailed a few weeks ago.
It is only a matter of time before that $1,400 hits most Americans' accounts.
The best penny stocks have one thing in common: revenue growth.
This is true for all types of stocks, but especially true when it comes to investing in low-priced stocks.
As we know, penny stocks can be the land of hype sometimes.
Rumors and social media posts can push these stocks higher, but there's no substitute for stone cold financials.
Using revenue growth as our yardstick, we can mine the gems in the trash pile and find those with the potential for enormous gains.
That's why we've dug into the balance sheets of some of the top penny stocks to uncover those with real potential.
Here are three of the best penny stocks to buy right now...
This could be the breakout year investors have been salivating over for months.
The combination of stimulus packages from Congress, low-interest rates, and widespread vaccination could get the economy roaring as the year progresses.
Most economists are now suggesting that 2021 will have the highest growth rate since 1984.
That economic turnaround is going to do wonders for the stock market, and the best penny stocks could see prices surge higher.
After all, their share price under $5 means even a small move in price can translate to big percentage gains for shareholders.
