Why Are Investors Paying Attention to These Penny Stocks?
Whether you’re just getting into investing or are a seasoned veteran, penny stocks continue to look quite attractive. When starting to look for penny stocks to watch, investors usually pick an area of the stock market to begin their search. Given that there’s plenty of volatility right now, it may be a good idea to broaden that search to stocks under $5 anyway.
In addition, investors should always be looking at what type of volume a penny stock is trading with. This can help determine the popularity of a penny stock as well as its liquidity. As of November 2020, there are a few key sectors that investors are focused on.
The first of these is biotechnology. With biotech stocks, investors should look for FDA approvals as well as what drugs or technologies a company has in its pipeline. In addition, many biotech penny stocks are working on Covid vaccines or treatments. Given the increased amount of Covid cases, these biotech stocks could have heightened opportunity.
Next, investors are showing a strong focus on health and wellness penny stocks. These are companies that typically produce products for sale in the health and wellness industry. This could be anything from CBD-based products all the way to beauty and healthcare supplements. As you can see, this area of the stock market is quite broad. While these two industries are not the only areas where the potential exists with penny stocks, they have been a place to start looking recently. With that, however, after the late-week surge, are they going to remain penny stocks to buy next week or will investors begin selling?
Penny Stocks to Watch: November 2020
Penny Stock to Buy [Or Sell]: Canaan Inc.
Canaan Inc. is a tech company that works in the research, design, and sale of circuitry products. The company states that its products are used for bitcoin mining that goes on in China. With the increased popularity of bitcoin that we have seen in the past few years, many investors have begun to pay attention to CAN stock.
Recently, the company announced its quarterly results for the period ending on June 30th. In the results, Canaan announced that it had sold 2.6 million Thash/s. This represents a quarter over the quarter rise of 198%. When we compare these numbers to the previous year, things don’t look so great for CAN stock. But, we have to remember that the price of bitcoin has crashed and rebounded in that same period. Because of this, investors should view the shorter time frame of quarter over quarter.
Compared to its first quarter of this year, Canaan Inc. has seen its revenue grow by 160% to just north of $25 million. The biggest surprise that the company announced was a gross profit increase of 1,711% over the first quarter of the year. In addition, this represents a 302% gain year over year.
Nangeng Zhang, CEO of the company stated that “during the second quarter of 2020, the COVID-19 pandemic continued to impact the lives of people around the world and the Bitcoin halving event also caused significant volatility in Bitcoin prices.”
While CAN stock could have potential, investors should remember that its steep correlation to bitcoin makes it quite a volatile penny stock to watch.
Penny Stocks to Buy [Or Sell]: Newage Inc.
NewAge Inc. is a health and wellness company working to produce several industry-leading products. The company states that it has several sales routes that it utilizes. This includes e-commerce, retail, and direct to consumers. While the latter two are quite straightforward, the company has been working heavily on its e-commerce presence. E-commerce has become extremely important to companies in the past six months due to Covid.
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Under the health and wellness umbrella, the company has three categories that it works in. These are wellness products, appearance products, and nutritional performance. These three branches of its brand could provide unique market opportunity and potential forward momentum.
Recently, the company announced that its direct-store-distribution division has seen one of its highest-performing years to date. Brent Willis, CEO of Newage Inc. stated that “the vision experienced significant disruption in the year due to Covid-19 and the shutdown of the majority of its foodservice and on-premise customers. Despite that obstacle and numerous complexities with the traditional grocery and convenience retailers, the group has offset those impacts to deliver record performance so far in 2020.”
In addition to this, the company recently was awarded the exclusive distribution rights for ZenWTR in its area. This should help the company to broaden its product horizon in the coming months.
Penny Stocks to Buy [Or Sell]: Mannkind Corp.
Mannkind Corp. Is a biopharmaceutical company that has seen some solid momentum in the past few weeks. Since the beginning of November, shares of MNKD stock have shot up a solid 12%. Since May of this year, shares of MNKD stock have grown by almost 75%. Recently, the company announced its Q3 revenue for 2020. In the announcement, the company stated that its main product, Afrezza, brought in net revenue of $7.3 million.
This represents 27% more than in the same quarter of the previous year. For those who don’t know, Afrezza is a fast-acting, inhalable form of insulin. In addition, the company announced that it finished the quarter with roughly $52.4 million in cash and cash equivalents.
Michael Castagna, CEO of the company stated that “as we head toward year-end, our focus remains on two significant drivers of value for shareholders: enabling healthcare providers to increase their prescribing of Afrezza and supporting United Therapeutics as they move the TreT clinical program to completion, including manufacturing TreT clinical supplies.”
As a biopharmaceutical company, Mannkind Corp. has several products in its research pipeline. For this reason, investors should keep up-to-date with any announcements that Mannkind Corp. makes.