Penny Stocks to Watch as the Market Rebounds
There was definitely a concern among investors recently. However, March may present a new, bullish case for penny stocks. As Monday, March 1st hit, most of the stock market was up by large numbers. By midday, the S&P 500 was up by around 2.25%, while Treasury yields also dropped substantially. Additionally, reports came out showing that U.S. manufacturing has hit its highest level in three years. While there isn’t one clear reason for this positivity, there are a few factors at play. Over the weekend, the government approved a vaccine made by Johnson & Johnson (NYSE: JNJ).
This vaccine candidate is injected in one dose and needs no refrigeration like the currently available vaccines. This is big news and could be a major component in the fight against the coronavirus. In a broader sense, investors are showing confidence that the pandemic could be subsiding.
It will take some time before a rollout occurs en masse. But the fact that it is on the table means that we could be closer to ending this pandemic. So with this positive and bullish sentiment affecting the market, here are four penny stocks to watch as the market trends higher.
Penny Stocks to Buy [or avoid]
- Qutoutiao Inc. (NASDAQ: QTT)
- Novan Inc. (NASDAQ: NOVN)
- Zomedica Corp. (NYSE: ZOM)
- Phunware Inc. (NASDAQ: PHUN)
Penny Stocks To Buy [or avoid] #1: Qutoutiao Inc.
Qutoutiao is a company that we discuss here quite frequently. In the past few months, there have been several days of double-digit percentage gains for QTT stock. In recent news, the company announced that it would be releasing its Q4 2020 financial results on March 4th. Ahead of this, let’s take a look at what QTT has been up to. For some context, Qutoutiao is a mobile content provider working out of China. The company provides a large range of entertainment services across its applications. The includes Midu Novels, Midu Lite, and more. These applications have seen heightened adoption over the past few years as the public scrambles to consume content.
In its latest earnings report for the third quarter of 2020, the company posted over $166 million in revenue. While this is a decrease of 15% year over year, we do have to consider the effects of the pandemic. In more positive news, the company reported an EPS of $0.14, which is almost 70% higher than in the previous year. Since January of this year, shares of the Chinese tech giant are up by almost 140%.
This meteoric rise is characterized by its commitment to continuing to provide high-quality content. While QTT stock can be quite volatile, it has shown a mostly positive trajectory over the past few months. Working across many application sectors, Qutoutiao has become a leader in the mobile content aggregation space.
#2: Novan Inc.
Novan Inc. is a biotech company working on producing a large range of novel medicines. It does this through its nitric-oxide-based tech platform known as Nitricil. This platform focuses on drugs that have potential applications in everything from dermatology to gastroenterology. In the past few months, its lead product candidate known as SB206 has seen heightened attention from investors. Currently, the antiviral gel is in use for the treatment of molluscum contagiosum. Also, it is in a Phase 3 clinical study known as B-SIMPLE4. This study is working to see if this treatment has efficacy for the broader public. Only a few days ago, the company announced its full-year 2020 financial results.
Paula Brown Stafford, CEO of the company stated that “with our accomplishments achieved over the course of 2020 and our near-term milestones ahead of us this year, we believe that we are well-positioned for an exciting 2021. As we continue to grow and build momentum advancing our priority development pipeline and the Nitricil platform technology, we are focused on preparing for success and equipping the Company with the necessary resources and capital.”
At the end of 2020, the company reported that its Nitricil platform has a potential application for Covid-19. While the study results on NVN10000 are still early, there are positive in-vitro results that have come out. In light of this, speculation has helped fuel the latest market momentum but will that last as March rolls on?
Penny Stocks To Buy [or avoid] #3: Zomedica Corp.
Zomedica is a provider of veterinary health products. This includes diagnostics, pharmaceuticals, and point of care products. In its latest financial results, ZOM posted a net loss of $0.05 per share. This is in comparison to a net loss of $0.19 per share for the 2019 fiscal year.
Robert Cohen, CEO of Zomedica states that “while we are thankful for our substantially improved balance sheet, we continue to be good stewards of our funds by remaining efficient in our operations as we prepare for the upcoming commercial release of Truforma.”
The company also detailed its rollout of TRUFORMA and how important it is. As with any biotech company, revenue can remain stagnant until a product is in the commercialization stage. This is the case with Zomedica right now. A few weeks ago, the company announced that the underwriter on its previously announced public offering exercised its full options to purchase an additional almost 13.7 million common shares.
This ultimately brought Zomedica’s last funding round to $200 million. This is good news for investors as this funding should allow Zomedica to enhance its commercial plans for TRUFORMA continuously. Also, the official launch of this is set for March. In light of the timing for commercialization, this will be an important topic to keep in mind.
#4: Phunware Inc.
Phunware Inc. is a tech company that is working in many novel industries across the tech marketplace. This includes media and data licensing, mobile software, content management, engagement insights, audience building tools, and much more. The company works broadly in the MaaS or multi-screen as a service industry.
Only a few days ago, the company announced that it had closed on an underwritten public offering. This offering, worth around 11.76 million shares of common stock, brought roughly $24.7 million in proceeds. As a tech company, Phunware works by offering services that can utilize existing infrastructure to digitize and bridge the gap between non-tech and tech products.
Randall Crowder, COO of Phunware recently explained, “we live in a connected world, but we are disconnected from the value technology can deliver…For example, having to wait in a lobby bar for a drink or stand in line at a check-in counter waiting to receive physical keys to a hotel room is an archaic process we no longer need to be subjected to.”
As you can see, Phunware has many opportunities that it is working to capitalize upon simultaneously. The company intends to modernize the current aspects of daily life that need updating. This is a large goal, but Phunware is working hard to make it a reality. Since December of 2020, shares of PHUN stock are up by over 150%. With this bullish trajectory in mind, is PHUN on your list of penny stocks to watch in March?