Penny Stocks You Can Buy For Less Than That Fast-Food Meal; But Are They Worth The Risk?
Penny stocks are some of the most popular types of stocks in the market right now. The fact that you can buy hundreds, thousands, or even millions of shares for a few hundred dollars is a big attraction to traders, especially those with smaller accounts.
What are penny stocks? We’re talking about shares trading for less than $5, according to the official definition. One thing you should never forget about these cheap stocks, as a result, is they can go down just as quickly as they rise. But visions of grandeur are hard to ignore. On top of that, mobile apps like Robinhood have made buying penny stocks much easier.
Now you can reach into your pocket, pull out your smartphone, and start trading. Is Robinhood the best app for trading? Everyone has their opinions. However, if you look at places like Reddit, where the app’s use is popular, many complain of slower trade execution times and technology glitches that sometimes prevent them from trading altogether.
Penny Stocks To Buy On Robinhood For Under $4
Regardless of the shortcomings, they haven’t stopped millions of users from downloading the app and depositing cash. Since most penny stocks on Robinhood are listed on the NYSE and Nasdaq, choices are limited. In general, trading OTC stocks is restricted with only a few exceptions.
With this in mind, we took a look at 3 penny stocks on Robinhood that can be bought for under $4 right now. But just because they’re cheaper than a fast-food meal, that doesn’t necessarily mean they’re worth the risk. I’ll leave that up to you to decide.
- Trinity Biotech plc (NASDAQ: TRIB)
- Kaixin Auto Holdings (NASDAQ: KXIN)
- Salem Media Group Inc. (NASDAQ: SALM)
Robinhood Penny Stocks To Buy [or avoid] 3. Trinity Biotech plc (NASDAQ: TRIB)
The last couple of weeks have been tough for Trinity Biotech stock. In fact, since it reached 52-week highs last month, the TRIB stock price has come back as much by more than 50%. This week started much different from how things settled out last week. TRIB jumped early in the morning session and continued on that trend into the early afternoon.
The company’s recent earnings report seems to have been the center of attention. Trinity beat significantly on EPS and sales. Analysts expected earnings per share of 14 cents, and Trinity delivered $0.34. Sales were expected to come in at $28 million, and the company actually came in with $32.77 million for the quarter. For the year as a whole, Trinity reported over $100 million in revenue, up nearly 13% from its 2019 results.
The growth was attributed to strong revenue from its clinical laboratory division. The company said strong sales resulted from its Covid-19 related portfolio with the PCR Viral Transport Media product leading the charge. The company is also working on a new HIV screening test, TrinScreen, expecting pre-qualification submission to the WHO by the end of March. So this could be something to keep in mind as the days dwindle this month.
2. Kaixin Auto Holdings (NASDAQ: KXIN)
Over the last year, one of the hotter niches has been online retail and really anything “digital.” Whether it’s eCommerce, digital entertainment, or fintech, traders have sought out different ideas. Kaixin has been making headlines this year regarding its acquisition of Haitaoche Limited. Haitaoche is a China-based online retail platform for imported automobiles. Kaixin also entered into a multi-year deal to supply vehicles to Haitaoche through a supply agreement with China National Vehicles Imp & Exp Co.
The deal will supply roughly $300 million worth of consumer vehicles for resale through Haitaoche’s networks this year. According to the company, the volume should increase at least 20% annually during a five-year period. The total contract value is around $2.3 billion.
This month the two expanded into a partnership with an online retail platform in China to tap into China’s e-commerce auto market. In light of this and the momentum behind some China-based stocks recently, KXIN could be one of the penny stocks to watch right now.
1. Salem Media Group Inc. (NASDAQ: SALM)
Salem Media is another one of the penny stocks on Robinhood gaining momentum this year. Since January 4th, SALM stock has climbed nearly 200% to date. Media and general content are being consumed in a big way right now. The pandemic put everyone in tune with things like “alternative facts” and “fake news.” Things like stay-at-home orders clearly enhanced the amount of media being accessed during the pandemic. This trend has continued in 2021.
Salem is working on creating a wide media footprint. The company’s multi-media holdings include everything from radio, digital media, books, and newsletters. It specializes in Christian and conservative content, which has recently become a center of interest for the growing community of conservative people looking for a place to call home and get news.
This week Salem announced that its podcast network is partnering with The Todd Starnes Podcast. Starnes has a long history of conservative entertainment. He’s also been a fixture on Fox News, hosting a daily radio program.
This news seems to have been well-received on Monday. SALM stock continued its recent rebound after testing its 50-day moving average on Friday.
Are Penny Stocks Worth It?
This is one of the questions I asked earlier. Deciding if penny stocks are worth the risk is entirely up to you. Can you handle big swings and not drop a bead of sweat? On the other hand, do you freak out if a stock shifts 5%? Penny stocks are high-risk and can be high-reward too. Keeping your risk tolerance in mind is key whether you’re buying penny stocks on Robinhood or other platforms. The best thing to start with is understanding exactly how to day trade in the first place. Once you get the basics out of the way, the rest is pretty easy.