Whenever we talk about penny stocks, we’re talking about stocks under $5. Now, that’s the basic definition of penny stocks. But when it comes to finding certain stocks to buy, you might adjust your price range a bit depending on your risk tolerance. While all penny stocks at lower prices aren’t guaranteed to be big movers, there is a general consensus. That is stocks trading at lower prices tend to see bigger volatility and quicker percentage changes.
Case in point with all other things constant, a $4 stock needs to move much more than a $0.04 stock to see a meaningful gain. On the other hand, the higher-priced penny stock has more wiggle room when it comes to the other side of the coin. I’m talking about when the price drops. In the same example, even a 1 cent dip for the 4 cent stock cuts its value by 25%. The 4 dollar stock barely “feels” the penny shift.Are Penny Stocks Worth The Risk?
Herein lies the issue with certain platforms. While TD Ameritrade and ETrade allow access to all penny stocks, penny stocks on Robinhood and Webull have restrictions. In particular, OTC penny stocks are restricted, for the most part. This effectively limits the number of companies accessible when it comes to cheaper stocks. The main reason being is that the NASDAQ and NYSE have strict minimum price requirements for companies listing on these exchanges; usually $1.
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Are there NASDAQ and NYSE penny stocks trading under $1? Sure, but the risk is that they either delist to the OTC or get halted by these exchanges entirely. Needless to say, it doesn’t stock users from looking for penny stocks on Robinhood & Webull at certain price levels. We’re not going to look at stocks under $1 in this article but we will take a closer look at some cheap names under $3.50. Will these be on your list of penny stocks to buy before 2021?Robinhood Penny Stocks To Buy Under $3.50: MannKind Corporation
Take a look at MannKind Corporation (MNKD Stock Report) since the start of the year, and you’ll see the penny stock experienced one of its best years since 2017. Not only did MNKD stock reach new 52-week highs of $3.25, but it also marked a year to date move of 144% so far. While we’ve followed this company since September of last year, there’s plenty happening recently that investors should keep in mind. Much of this has to do with the company’s pipeline developments for inhalation treatments.
“We have focused on building a stronger pipeline to treat unmet needs for orphan lung diseases, an area where we can leverage our experience and technology to create differentiated therapeutic products,” said Michael Castagna, MannKind CEO in a December update. MannKind recently acquired QrumPharma Inc. to gain access to a lead program expected to enter Phase 1 in late 2021 for a lung disease treatment (QRM-003).
The treatment has already been designated as both an orphan drug and qualified infectious disease product by the FDA for treating pulmonary nontuberculous mycobacterial infections. Considering the timing of Phase 1 trials, MNKD stock could be one to keep on watch heading into the new year.Robinhood Penny Stocks To Buy Under $3.50: Akebia Therapeutics
Akebia Therapeutics (AKBA Stock Report) has experienced a much different year than MannKind. In fact, it wasn’t a penny stock for most of 2020. That is, until falling like a rock in September. The move came after Akebia revealed not-so-hot top-line results from a Phase 3 program of its vadadustat treatment for anemia. Since then, Akebia has been working toward a viable path forward. This included completing a pre-NDA meeting with the FDA, which remains on track to submit a vadadustat NDA next year.
“A key component of this NDA is the positive data from our global Phase 3 INNO (2) VATE program for the treatment of anemia due to CKD in adult patients on dialysis, which we shared most recently at ASN Kidney Week,” said John P. Butler, Akebia’s President, and CEO in a Q3 business update.
The company has been conducting its AkebiaShares initiative. This week, Akebia hosts a panel discussion on Wednesday after the market close discussing kidney care. The goal of these panels is to bring open discussion among industry leaders to share information on care for kidney diseases. So if AKBA is on your list of penny stocks to watch, make sure you remember December 16ht as the date of this panel discussion.Robinhood Penny Stocks To Buy Under $3.50: Farmmi Inc.
We’ve talked a lot about mushroom stocks this month. Farmmi Inc. (FAMI Stock Report) isn’t your typical magic mushroom stock, however. In fact, the “magical” part of this is simply the fact that Farmmi continues securing retail deals for its mushroom products. In this case, the products are non-psychoactive, nutritional-based products. While it is a relatively thinly traded penny stock, it hasn’t stopped FAMI shares from rising over 80% since the start of the third quarter.
The company sells edible fungi and this week it added to its growing list of deals closed in 2020. Farmmi’s subsidiary, Zhejiang Forest Food Co., Ltd. , received another multi-product order from a Japanese customer.
“We are excited to be ending the year with momentum in our business…We expect this trend and the broader market growth will continue as we move into 2021.”Yefang Zhang , Farmmi’s Chairwoman and CEO.
If you’re looking for mushroom stocks to buy this year, you might come across FAMI at some point. While it isn’t the psychedelic kind, the penny stock itself has seen steady yet significant growth this year. Will that continue into the new year?