If you are a penny stock or small-cap stock trader, then you know it can be rough when you are trading the best stocks under $5
You know what I am trying to say, right? Micro-cap and small-cap stocks are as volatile as bottle rockets and trading them are not for the faint of heart. And neither are the best stocks under $5…
Now, if you are totally unfamiliar, here is a quick primer: penny stocks can trade on the Over-the-Counter Bulletin Board exchange (OTC), a daily listing of the bid and ask prices for over-the-counter stocks, usually because they are too small to meet exchange-listing requirements.
OTC stocks are less regulated than stocks on the NYSE or Nasdaq, which means it can be difficult to know all the details about the company before you invest. To be frank, OTC stocks are not required to be transparent and often their press releases are hilarious exaggerations, so don’t believe everything you read.gett
One more thing to know, OTC stocks have less liquidity than exchange-traded securities along with lower trading volume, and larger spreads between the bid price and the ask price.
If we haven’t scared you off yet, it is because you know this: penny stocks and cheap stocks under $5 can mean mammoth returns or it can mean losing everything in minutes—it’s the Wild, Wild West. So, if you are ready to ride, here are the best five stocks under $5 right now.
Best Stocks Under $5 To Buy Now
Opko Health (NASDAQ: OPK)
Opko Health is a medical company based in Miami, Florida. They make pharmaceutical products as well as medical tests. They are a global company and are active in over 30 countries around the world.
While Opko has many operations in their portfolio, the largest is BioReference Laboratories, which focuses on genetic testing. Some of Opko’s most successful products include a blood test for prostate cancer as well as a treatment for chemotherapy-induced nausea.
Many investors have been excited about Opko Health stock this year. Their shares shot up by 169 percent over the course of 2020. Part of this is because BioReference pivoted to focus on COVID-19 PCR testing, which has been in high demand around the country.
However, the company’s most recent earnings report had some investors a little concerned. Opko’s stock price dipped slightly after the report came out. Although their overall bottom line improved, their drug sales have slowed down and their operating expenses increased.
This isn’t necessarily something to be concerned about in the long run, though. Opko’s revenue went up, and their EPS beat consensus estimates. If they’re able to keep this revenue growth up, it should balance out any fluctuation in drug sales.
Additionally, Opko Health has announced that they will be part of the NY Forward Rapid Testing Program. This program aims to increase access to rapid COVID-19 tests. Opko has opened eight rapid testing locations throughout the US as a result. They’ve also recently committed to expanding COVID-19 testing for schools.
The recent dip in Opko Health’s stock price actually makes it the perfect time to buy. This is a stock that definitely has the potential to pop above the $5 per share mark at some point this year.
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ElectraMeccanica Vehicles Corp. (NASDAQ: SOLO)
The electric vehicles industry has been booming this year, as many people realize just how important it is to switch to alternative fuel sources. As a result, many investors have been on the hunt for promising electric vehicle stocks. ElectraMeccanica Vehicles Corp. could fit the bill – they are a small-cap Canadian EV company with a lot of promise.
ElectraMeccanica’s flagship product is the Solo car. This is a very small personal vehicle with only one seat. It’s designed to be easy to charge and maintain, and caters to the urban commuter. They’re also planning to release two larger models in the future, both of which will have two seats.
While ElectraMeccanica may be a small company, their cars are stylish, eco-friendly, and designed with the modern driver in mind. The company is currently building a manufacturing center in Mesa, Arizona, which will likely help them increase their production capabilities.
SOLO stock has performed well over the last year, but there’s still definitely plenty of room to grow for this company. If you’ve been interested in the electric vehicles industry, this stock could be an affordable way to invest in it.
Best Day Trading Stocks Under $5
Express (NYSE: EXPR)
Express is a popular fashion retailer with locations all over the United States. Many fashion retailers struggled during the COVID-19 pandemic as they had to close their in-person locations.
However, the recent availability of the COVID-19 vaccines has meant that cases are going down and retail stores can open back up again. Many people’s disposable income has increased as well, and they are able to spend money on things like new clothes. This is very promising for stores like Express, which generally caters to young professionals.
Express has struggled with their revenue numbers since the start of the pandemic, which was to be expected given the necessary retail closures around the country. However, Express has garnered the attention of investors on Reddit and has quickly gained ‘meme stock’ status.
This kind of attention is likely to be a positive thing for Express, even if it makes the stock more volatile in the short term. If you’re willing to take a chance on meme stocks this year, Express could be a good pick for you.
See Also: Joel Litman’s Hidden Alpha Review
Biotech Stocks Under $5
Aptinyx Inc. (NASDAQ: APTX)
Aptinyx is a pharmaceutical company based in Illinois. They have a focus on treating neurological disorders, and their drugs focus specifically on NMDA receptors.
An ongoing study into an experimental Aptinyx PTSD treatment is showing promise mid-way through trials, according to an October 20 announcement. The 153-patient study found ‘statistically significant and clinically meaningful efficacy results with a favorable adverse event and tolerability profile.’
In other words, it’s looking good for NYX-783 early on. They have recently moved the drug into phase 2 of clinical trials. The drug has also received a fast track designation from the FDA, which means it could get approved very quickly if these tests are successful.
PTSD is becoming an increasingly prevalent mental health issue in the developing world, and effective treatment options are scarce. Aptinyx might be onto something with NYX-783, and share prices could skyrocket if they get it right.
In addition to their PTSD treatment, Aptinyx has two other drugs in the pipeline. NYX-2925 is currently in phase two of clinical trials and also has a fast track designation from the FDA. This drug will treat painful diabetic peripheral neuropathy and fibromyalgia. Their third drug, NYX-458, will treat the cognitive impairment associated with Parkinson’s disease.
Many analysts have felt bullish about Aptinyx stock this year, but their share price has fallen over the past few months. However, the company recently presented more data from their NYX-783 study, indicating that they’re still on the right track. When taking this news into account, now could be a good time to buy Aptinyx stock while it’s at a low point.
Best Tech Stocks Under $5
LiveXLive Media (NASDAQ: LIVX)
LiveXLive Media is a digital media company that focuses on the acquisition, distribution, and monetization of live music, internet radio, and podcasting, among other digital enterprises. LiveXlive Media is also the force behind Slacker Radio, a moderately popular live music streaming platform.
LiveXLive has had a good past year thanks to its focus on streaming music and podcasts. Given that live in-person music has tanked recently, their focus on streaming live music has put them in a unique niche and their share price is expected to continue to rise as more people look for ways to experience live music via streaming services.
The stock’s price has steadily increased over the last several months. The stock dipped slightly in the middle of February, but that means it could be the right time to buy before it goes back up again. Demand for music and podcast streaming isn’t going to go away anytime soon, as we are still several months away from hosting live events like concerts again.
While LiveXLive isn’t profitable yet, their revenue numbers have consistently increased over the past several quarters. They are taking steps to diversify their operations, with both subscription and pay-per-view models to choose from.
PixelWorks (NASDAQ: PXLW)
Another industry that has been very successful this year is the semiconductor industry. However, many of the world’s top semiconductor stocks come with a high price tag. Pixelworks is a more affordable option to consider adding to your portfolio.
The company is based in San Jose, California and develops semiconductors specifically for video and pixel processing. They have developed a range of technology related to video displays, including projection and digital display services.
Video technology is more important now than ever. Not only do consumers watch videos for entertainment, but they also create them to communicate with each other. It’s become paramount for electronic devices to have video capabilities, which is why Pixelworks’ products are so important.
Pixelworks has partnerships with several electronics manufacturing companies. Their most recent earnings report posted a loss, but they did exceed expectations in terms of overall revenue numbers. Their stock price has seen several weeks of slow but steady growth in May.
Fluent (NASDAQ: FLNT)
The advertising industry struggled during the pandemic, as many businesses had to cut their budgets. As COVID-19 vaccines become more available, many companies are reinvesting in their advertising in order to draw clients back in. Fluent is a unique advertising and media company that offers digital solutions for their clients.
Fluent uses a variety of digital media properties to develop custom advertising campaigns and monitor user engagement. Their service helps target products and services to the right audience for a higher conversion rate.
This unique approach to advertising can be very effective. Since we use the internet for virtually everything these days, using digital marketing is a quick way to reach your target audience. Despite the challenges of the pandemic, Fluent has managed to succeed with this marketing approach. Their 2020 year-end earnings report showed significant growth from 2019.
Also Read: Fast Fortune Club Review
Best Asian Stocks Under $5
Tuniu Corp. (NASDAQ: TOUR)
It’s understandable why many investors have been wary of the travel industry this year. Pandemic-related shutdowns have grounded flights around the world, and people have been avoiding hotels and restaurants.
However, the Chinese market has been one of the first to start recovering. Tuniu is a Chinese digital travel agency that offers air and rail reservations, car rentals, tour packages, and more.
This could be a good option for investors that are feeling bullish on the travel market and economic recovery in general. Their share price has gone up significantly since February, albeit with some fluctuations.
Dividend Stocks Under $5
Telefonica S.A (NYSE: TEF)
If you’re looking for a stock under $5 with a huge dividend yield, this is definitely one to keep in mind. Telefonica stock currently pays a huge 8.81 percent yield.
Telefonica is a communications company based in Spain. They provide wireless service in Europe and Latin America.
Although Telefonica did see a drop in revenue last year, their share price still looks relatively cheap. Right now, they have a price to earnings ratio of 12.18. This indicates that the stock is fairly affordable given the company’s current financial standing.
There’s plenty of opportunity for growth in this industry. Many people have been relying on their phones for communication more than ever. With some companies switching to permanent remote work, it’s unlikely that demand for these services will go away.
Best Stocks Under $5: Conclusion
Those are the names we consider hot stocks under $5 across markets right now. There will be lots of opportunities in the markets ahead but expect volatility.
Did we miss any stocks you are making gains with? Let us know in the comments.
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