Are penny stocks worth it? These cheap stocks can become huge moneymakers if you understand how to handle volatile trading and manage risk. According to the definition of penny stocks, we’re talking about shares trading for $5 or less, and the lower the price, the higher the inherent volatility. Today we look at a handful of penny stocks that can be bought for under $1.
Penny Stocks Under $1 To Watch
- Exela Technologies Inc (NASDAQ: XELA)
- Rockwell Medical Inc. (NASDAQ: RMTI)
- Sundial Growers Inc. (NASDAQ: SNDL)
- Alset EHome International (NASDAQ: AEI)
Best Penny Stocks To Buy Today
Making money with penny stocks might appear to be an easy task. All you need to do is find some cheap stocks, hit the buy button, and watch the profits roll in, right? As great as that sounds, there’s a lot more to consider when trading penny stocks. The first step is understanding how to trade them. While shares of Apple (NASDAQ: AAPL) might fluctuate in price by a few pennies, it doesn’t equate to much by means of the percentage change.
A few pennies can make a huge difference in your portfolio value when it comes to penny stocks, let alone penny stocks under $1. Since this goes for bullish and bearish moves, learning the basics of trading will come in handy. I’ll get into more details on that later in the article. Now, let’s look at a few penny stocks that can be bought for under $1. Are they worth the risk?
1. Exela Technologies Inc (NASDAQ: XELA)
Shares of Exela Technologies have been on the radar of retail traders for the better part of the last month. Despite the slow sell-off, XELA stock is on the move to begin the short trading week. The move comes just days after winning a $13 million contract to provide a billing and payment suite to a new customer. This 4-year contract will see Exela offer its TMS payment processing platform, Beats collaborative workflow, and DMR digital mailroom solution.
On top of that, upbeat sentiment in the stock market today has focused on Exela’s recent vote cancelation that would support a reverse split of the company’s shares. The company said that it believes continued listing n the Nasdaq is “important” to shareholders and that it may revisit the need to seek a reverse split based on compliance requirements by August 8th.
Considering the latest client win and multi-million dollar contract, traders have taken the vote cancelation positively.
2. Rockwell Medical Inc. (NASDAQ: RMTI)
Another one of the penny stocks with news today is Rockwell Medical. Monday’s headline has sparked early momentum for the biotech stock as traders continue circulating details. Rockwell announced that it expanded a partnership with DaVita Inc. (NYSE: DVA), a kidney care provider.
Under the expanded partnership, Rockwell will focus on its concentrates business and the ability to operate profitably. DaVita also entered into a stock purchase agreement to invest up to $15 million via two tranches of $7.5 million with a conversion price of $1 per share. Considering that the current price of RMTI stock is well below this threshold, it appears DaVita is taking a more bullish stance on the company.
“As the second-largest supplier in the United States of life-saving hemodialysis concentrate products, Rockwell Medical is important to the dialysis industry and the patients we serve,” commented Russell Ellison, M.D., M.Sc., President and CEO of Rockwell Medical. The market responded favorably on Monday, with RMTI stock jumping to highs of over $0.50 during premarket trading.
3. Sundial Growers Inc. (NASDAQ: SNDL)
Shares of marijuana stocks have experienced significant levels of volatility over the last few weeks. This is thanks in part to the speculation stemming from new US legislation. The U.S. House passed a bill to take marijuana out of the federal controlled substances list. Next up is the Senate vote on the proposal. Senator Chuck Schumer noted discussions with Senators Cory Booker, Roy Wyden, and Mark Warner and stated, “We hope to do that towards the end of April” and that he had reached out to “a few Republicans to see what they want” to get the vote passed.
Though critics don’t think the vote will go the way many hope for, that hasn’t slowed down investors from piling into the cannabis market again. Sundial Growers has become one of the most popular marijuana penny stocks under $1. Shares surged to nearly $0.90 in the days leading up to the House vote but have since slid back to around $0.50. Filing delays have put a pause to bullish sentiment while traders await the official details of 2021’s performance.
What’s more, Sundial’s Alcanna acquisition has finally come to completion. Late last month, the company buttoned up the $255.55 million deal that had been in motion since last year. Based on the deal, Sundial staked claim to becoming “Canada’s biggest private-sector liquor retailer,” despite the market’s clear focus on cannabis. Management emphasized that this facet of the deal will add more sustainable cash flow to Sundial’s business overall. Meanwhile, Alcanna’s majority-owned subsidiary, Nova, currently owns or operates 78 cannabis retail stores under its Value Buds brand. When combined with Sundial’s Spiritleaf operations, the company stakes claim to a retail network of more than 180 locations in Canada. Considering pending legalization talks, cannabis stocks could be on the radar of traders this quarter.
4. Alset EHome International (NASDAQ: AEI)
One of the hottest topics, at least in the retail trading portion of the market, is insider trading. This isn’t the same idea as “Blue Horseshoe Likes Anacott Steel,” but something more along the legal lines of the idea. Also, if that phrase is a bit over your head, check out the original 1987 Wall Street movie with Charlie Sheen. All jokes aside, insider activity has become a cornerstone for some researching penny stocks to buy.
The bullish support of management buying shares in their own companies has brought optimism to the outlook for traders. In this light, Alset EHome is having an active month for insider buying, mainly from its CEO, Heng Fai Chan. Since the start of April, Chan has purchased millions of shares of AEI stock with the latest purchase bringing his total holdings to more than 37.36 million shares.
The company primarily works with EHome communities and property development. However, it has also begun transforming its model to include Fintech. In particular, the company recently launched Alset Mining Inc. to start cryptocurrency mining activities. Co CEO Chan Tung Moe explained in a March update, “As the cryptocurrency mining market is expected to reach USD5.29 billion by 2028 with a CAGR of 28.5%1, this represents a huge upside within this emerging technology space that is rapidly changing every day. We believe that the cryptocurrency mining opportunities in the market remain profitable.”
Though cryptocurrency prices are down today, there is still a fervor for stocks involved with digital assets, mining, and the like.
Penny Stocks In April
This month and most likely this year, many different dynamics will factor into the long-term outlook on the stock market. Whether it’s higher inflation, interest rates, global conflict, energy prices, or virus concerns, many catalysts are playing a part. When it comes to penny stocks, broad trends impact certain stocks differently; in some cases, that means no impact at all. With this in mind, make sure you understand what catalysts are at play when looking for penny stocks to buy or add to your watch list. If you’re new to trading, here are a few articles to check out: