Are These Epicenter Penny Stocks Going To Stay That Way For Long?
Penny stocks continue to remain a hot topic among traders. This year, countless companies started trading under $5 a share thanks to fear stemming from COVID restrictions. However, one group, epicenter stocks, have become a key focus for investors. What are epicenter stocks? These are stocks that were crushed by coronavirus restrictions but could rebound the most. That’s according to Fundstrat’s Tom Lee. He’s explained that this could be like looking at certain companies after the dot com bust in the early 2000s. What’s more, is that hopes of a vaccine initially fueled the speculation surrounding these reopening stocks.
Are epicenter penny stocks safe? The term “safe” doesn’t naturally go hand-in-hand with the idea of penny stocks. Furthermore, when you’re talking about companies that’ve gotten crushed in the market, many have a long road ahead. That road can involve hefty sums of capital not only to recover but to maintain operations. Look at some of the cruise ship companies, for example. This week, Norwegian Cruise Line (NCLH Stock Report) was riding high after news of Moderna’s vaccine success. However, the company didn’t let traders and shareholders forget about the stark reality that the pandemic has brought. Norwegian stock tumbled in late afternoon trading on Tuesday. This came after the company announced an $832 million raised to fund ongoing operations.
If this is the case with blue-chip stocks, why couldn’t that be in play with penny stocks? Keep this in mind during times like these where the overly exuberant market can make traders forget about their strategy in lieu of letting emotion dictate the pace. With this in mind, are these 5 epicenter penny stocks to buy right now because you think they might head higher, or is selling pressure going to trigger consolidation before December?
Epicenter Penny Stocks To Buy [or sell]
- Party City Holdco (PRTY Stock Report)
- Express Inc. (EXPR Stock Report)
- Ayro Inc. (AYRO Stock Report)
- Chico’s Fas Inc. (CHS Stock Report)
- Inpixon (INPX Stock Report)
Epicenter Penny Stocks To Buy [or sell]: Party City Holdco
Party City has long been on our list of penny stocks to watch. As one of the hottest on the list, PRTY shares have recovered relatively quickly over the last few months. Since late-May, the penny stock has held a strong bull trend climbing from around $0.72 at the time to highs this week of $4.87 so far. This 576% rally has been fueled by speculation and execution on behalf of Party City. Where many retailers have suffered long-lasting blows, the company managed to nimbly weather the COVID storm by closing locations and cutting staff where needed. It further took on a brick and click model early on.
This helped the company remain on track and beat analyst estimates. The most recent quarter showed Party city recording an earnings per share of 10 cents compared to expectations of a loss per share of 32 cents. Sales also came in stronger at $534 million compared to estimates of $489.3 million in the quarter. While this is great in the interim, the recovery ahead will be what investors will focus on. Furthermore, insiders have shown optimism. This week, Director William Creekmuir purchased just under $100k worth of stock according to a FORM 4. Now that the Halloween season has passed, which is Party City’s most important period, it will be up to the company to continue on this trajectory.
Epicenter Penny Stocks To Buy [or sell]: Express Inc.
Strong retail earnings from the likes of Target this week have helped give the sector a boost. With that, we’re not only seeing Party City gaining but other retailers like Express Inc. Similar to Party City, Express also focused its efforts on evolving its online presence amid coronavirus lockdown measures. Since the beginning of the month, EXPR stock has climbed from around $0.60 to highs this week of $1.09 so far. Express is expected to release third quarter earnings at the beginning of December. While we’ve got yet to see these results, we can see how Q2 figures look to compare to in a few weeks.
In its last filing, the company record a miss on both EPS and sales. “When we began the transformation of Express, we certainly did not anticipate a global pandemic, and none of us could have imagined the duration or magnitude of its impact on the retail apparel industry”, said Tim Baxter, Chief Executive Officer in the Q2 business update. “I am encouraged by the momentum in our eCommerce business, the strong response to our August fashion deliveries, and the increase in customer engagement with our brand messages. While mall traffic continues to be challenging, I would expect our results to improve as we move through the back half of the year.”
So we’ll see if that has translated into stronger Q3 figures in December.
Epicenter Penny Stocks To Buy [or sell]: Ayro Inc
One of the other sectors that felt some pressure this year was tech. However, whether it’s due to reopening optimism or general sector trends, electric vehicle stocks and clean energy stocks have turned higher during 2020’s second half. Ayro Inc. is one of the few electric vehicle penny stocks left trading below $5. We’ve previously discussed companies like Electrameccanica Vehicles Corp., Kandi Technologies, and even Nio Inc. All have since graduated from the penny stock levels and now trade much higher.
Ayro, specifically focused on EVs for short haul markets like business complexes and college campuses. The more recent focus has been on expanding its offering. Agreements with Gallery Carts and Karma Automotive have given traders something more to chew on recently.
“Given our strategic partnerships with industry leaders like Club Car, Gallery Carts, and now Karma Automotive, our strong balance sheet, and our internal team who will continue to innovate and help bring next-generation purpose-built EVs to the market, the outlook remains quite bright for us, and we are truly excited about AYRO’s future.”
AYRO Chief Executive Officer Rod Keller, Q3 Earnings Report
Epicenter Penny Stocks To Buy [or sell]: Chico’s FAS Inc.
Chico’s, similar to Express has benefited from upbeat sentiment related to retail. B. Riley FBR recently downgraded the stock and put at $1.50 price target on it as well. With upcoming earnings next week, the layer will be pulled back to see if the company has executed on its operating strategy set out earlier in the year. The company missed on both EPS and sales in the last quarter. However, the company was able to reopen 96% of its store base according to Chico’s.
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“Store and digital conversion rates improved in the second quarter, providing an indicator that our product changes to comfort, casual and easy-care fabrics are resonating with customers, giving us confidence our financial and product initiatives combined with relentless customer focus have positioned us to emerge a stronger company. I remain excited and optimistic about the future of Chico’s FAS,” said Molly Langenstein, Chief Executive Officer and President, Chico’s FAS.
Will this move translate over to a stronger Q3 result?
Epicenter Penny Stocks To Buy [or sell]: Inpixon
Inpixon is the final name on this list of epicenter penny stocks is more a focus as the economy reopens. This week the company announced that its Inpixon Mapping was selected to provide visualization required for tracking Inpixon’s COVID-19 vaccine-related assets.
Nadir Ali, CEO of Inpixon, commented, “We are proud that our mapping platform was selected by this leading pharmaceutical company to provide the visualization required for tracking vital assets as part of the effort to combat the COVID-19 pandemic. This most recent contract serves as a prime illustration of how our technology can assist in addressing critical supply chain requirements.”
When it comes to “reopening” similar technologies may prove useful. In the case of INPX stock, the news has been digested and traders reacted favorably so far this week. Will this become a constant on your list of epicenter penny stocks to watch in November?