Cheap Penny Stocks On Robinhood Are Hard To Come By
Buying penny stocks on Robinhood has become the norm for many traders. Given the app’s easy set-up and clear-cut operating platform, millions of new retail traders have made it their go-to platform. I know there’ve been plenty of concerns, including the lack of transparency from the company itself. Robinhood was also at the center of the debacle when the app restricted trading for specific “short-squeeze” stocks on Reddit.
Despite this as the case, plenty of retail traders are using the platform to this day. The sticking point for many is that the app doesn’t allow access to over-the-counter or “OTC Penny stocks.” Not all penny stocks on the OTC are shady companies like the Wolf Of Wall Street movie portrayed in all fairness. But the reporting requirements are much laxer than those of the listed exchanges, including the NYSE and Nasdaq.
Here’s where today’s topic comes into play: Penny stocks to buy under $1 on Robinhood.
Penny Stocks On Robinhood Under $1
These are a rare breed on that app and a risky group of stocks at that. Aside from all of the other risks that come with low-priced stocks, Robinhood adds another layer. Since these are listed penny stocks, the Nasdaq and NYSE require companies to maintain certain requirements, including a minimum bid price.
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What are the Nasdaq & NYSE minimum bid prices? Once listed, the price must maintain a level of $1 or higher. So when you’re talking about any companies trading below this price, the risk is that they could be delisted from the exchange. Then you might be dealing with a bigger issue: trading OTC stocks on Robinhood, which we know is not “the thing” to do on the app.
Even with this as the case, there are still traders looking for cheap stocks on the platform. In this case, we’ve got a list of penny stocks on Robinhood to buy for under $1. Are they worth the risk? You be the judge.
- IT Tech Packaging Inc. (NYSE: ITP)
- Teligent Inc. (NASDAQ: TLGT)
- Advaxis Inc. (NASDAQ: ADXS)
- Acasti Pharma Inc. (NASDAQ: ACST)
- Synthetic Biologics Inc. (NYSE: SYN)
Robinhood Penny Stocks To Buy [or avoid] #1: IT Tech Packaging Inc. (NYSE: ITP)
The first on this list of penny stocks under $1 on Robinhood is IT Tech Packaging. It was a popular stock to watch during the pandemic’s early days when everyone was scrambling for toilet paper and other paper products.
IT manufactures paper in China ranging from corrugated cardboard, printing paper, bathroom & kitchen paper, and face masks. In fact, the company managed to grow sales from tissue paper products by 51.3% to a total volume of 3,165 tonnes in the 4th quarter.
In its last earnings update, the company said that it’s in the process of applying for a surgical face mask production license. It looks like the next step is to get its on-site inspection, which was delayed by the pandemic, and obtain final review results.
Considering that coronavirus is sticking around for a little longer, paper products companies could be the unsung heroes of the post-pandemic economy. We’ll still likely have a use for face masks, and, of course, there’s always a need for paper products. In light of its fourth-quarter growth, IT Tech might be a company to watch, and it still traded below $1.
2. Teligent Inc. (NASDAQ: TLGT)
Another one of the penny stocks on Robinhood under $1 is Teligent Inc. The pharmaceuticals company provides specialized generic drugs. Teligent provides a wide range of generics, including injectables and topical products.
Thanks to COVID-19, however, the company has been more focused on recapitalization efforts most recently. Since June, it has managed an aggregate reduction in its debt of $118 million and recently completed a $77 million debt-for-equity swap with Series C noteholders.
Tim Sawyer, Teligent’s President and Chief Executive Officer, explained earlier this year that he believes “that through the debt-for-equity exchange, incremental loan availability and the ATM equity offering, we will achieve a financial structure that will enable us to continue delivering quality products for our customers and patients and grow our relationships with all stakeholders.”
In an 8-K filing Thursday, the company gave more details on the ATM program. It managed to raise $38.5 million with shares sold at an average price of $0.993, a premium to the current market price. Something else you’ll find by looking at the filings is a prospectus outlining details of an upcoming shareholder meeting. Among the topics up for a vote is a proposed reverse split at “at least” one-for-three. This may be an effort to maintain compliance with the exchange.
3. Advaxis Inc. (NASDAQ: ADXS)
Shares of Advaxis briefly traded above $1 this year but like many stocks last quarter, shares slid in late February and March. The last week has seen somewhat of a sideways trend in ADXS stock. Shares have maintained a level of support above $0.69.
Advaxis recently presented a corporate overview at the Benzinga Biotech Small-Cap Conference last week. One of the things that the market is likely seeking details on is the state of the company’s ADXS 503 treatment. It had expanded enrollment in the ADXS-503 HOT program to explore the potential to enhance or restore sensitivity to checkpoint inhibitors. In a Phase 1/2 trial, data presented showed a disease control rate of 67% and an overall response rate of 17% in the first 6 patients able to be evaluated. These patients had immediate or prior progression on Merck’s (NYSE: MRK) KEYTRUDA treatment.
Something to look for in addition to further details on ADXS-503 will be information on its ADXS-504 platform. The company is planning to expand into prostate cancer with ADXS-504 and aims to provide study updates “in the coming months.” That’s according to comments made in a recent quarterly update in March.
4. Acasti Pharma Inc. (NASDAQ: ACST)
We had someone comment in March, looking for biotech penny stocks on Robinhood under $1. Acasti is the third name on this list of penny stocks to fall under that umbrella. The company has actually been looking at strategic alternatives for the last few months. Last year, its CaPre treatment had missed the mark in a pivotal trial, which sent shares plummeting. However, since then, the focus has remained on capitalizing its business and positioning the company properly to drive shareholder value.
What does that mean right now? That means Acasti has been raising money and a lot of it. This is now into the tens of millions of dollars to “provide additional flexibility” in its current review process exploring strategic alternatives.
With this in mind, I think that speculation is one of the main drivers in the stock market today. There haven’t been many other updates from the company. Nor has it filed much more than an 8-K within the last 30 days. But given that it is pursuing strategic alternatives, it could remain a stock to watch for the time being.
5. Synthetic Biologics Inc. (NYSE: SYN)
Finally, Synthetic Biologics is on this list of penny stocks on Robinhood under $1 after some recent milestones from the company and the market. First, this week Synthetic announced that enrollment has commenced, and six study participants were dosed in a Phase 1a single-ascending dose clinical trial of SYN-020 intestinal alkaline phosphatase. This now paves the way for potential updates on interim data read-outs to look out for and any other information related to this study. Biotech companies are well-known for doing things like this, and beginning enrollment is the first step. SYN-020 is intended to treat both local gastrointestinal and systemic diseases.
Steven A. Shallcross, Chief Executive and Financial Officer, explained, “In the U.S. alone, prevalent cases of celiac disease are expected to increase to 4.3 million by 2023, representing a significant market opportunity for a highly differentiated product such as SYN-020. We look forward to announcing topline results from this study as well as commencing a multiple-ascending dose study of SYN-020 anticipated during the third quarter of 2021.”
So now we’ve got a little timing to incorporate it into the research process. The third quarter is when Synthetic expects top-line results and to begin a multiple ascending dose study. On top of this, the market has apparently grown more bullish, with analysts like Maxim upgrading their rating on the company. The firm boosted SYN from Hold to Buy and set a price target of $2.50.
Penny Stocks & Risk/Reward
All penny stocks on this list are trading for less than $1 right now. So, yes, you can buy these for pennies. But just because they’re “cheap,” are they worth the risk. In general, when you’re talking about lower-priced stocks, even a small fluctuation can mean larger percentage changes. This works for bullish and bearish moves. So before you decide to buy penny stocks like these, weigh the risk-reward of the trade.