Before we look at the best penny stocks and dive into business profiles, let’s talk about how to trade this niche market.
The first thing to know when trading the best penny stocks is you have to be able to spot potential red flags and signs of fraud. First things first, if there is a caveat emptor sign. Or a skull and crossbones next to the penny stock’s name, well, yeah, maybe stay away.
Next, if a company suddenly starts skyrocketing on no legitimate news. As nice as that sounds, the stock is probably being manipulated. These are very small companies and even some with wonderful business models will not leap significantly overnight.
Penny stocks take time to mature because they are small operations. Check the charts and make sure the trades are not abnormal.
After that, do your own research and throw price out the window. The best penny stocks are speculative and pricing is notoriously spooky. Make sure you know the penny stock’s real value and that you have enough information to make a holistic decision about the company.
And yeah, let’s ponder the obvious question: why is the stock’s price so low? Investors have signaled that the shares are not worth much. Or the company has fallen on difficult times financially or business model-wise. So, know that information at the outset.
In short, read a little bit before you throw your money at a broker-dealer.
And about that money burning a hole in your pocket. Before you place it on a penny stock, it best not be your inheritance. It better be cash you can afford to lose. Statistically speaking, penny stock traders lose a lot more money than they make.
So, make sure you are ready to ride. Penny stocks require a person who can handle volatility. And oh yeah, if you are trying to trade penny stocks because you saw an ad on Youtube with someone flying on a private jet, stop right now. You are already in over your head.
Can You Get Rich Off Penny Stocks?
Ok, so you saw that video of that guy in the jet. He was once a loser at a desk and now he is eating caviar out of a football helmet. Sure. We have seen it as well.
It’s a real rags-to-Tyler Durden kind of story. But, we are here to tell you that if your BS meter did not flinch, well, this may not be right for you.
The short answer to the question is: yes. Yes, you can get rich trading penny stocks.
It is a low probability, though.
But, sure, you can get rich. Why? Sheer math. You are trading stocks that are worth pennies. Often you buy a lot of stock. If that stock goes to a dollar or even say $10, you can do pretty well.
For example, let’s say you own 1,000 shares of a company at a quarter. Your total investment is $250. Now, if that stock goes to $2.50, your $250 investment is now worth $2,500.
That was a sandbox example. But add a few zeroes in there and you will see the allure.
And while it may seem like a big hill to climb, it is not. Penny stocks have high volatility.
What Are the Best Penny Stocks To Invest In?
The answer to that question is simple: the one you have researched thoroughly. Do not invest in any penny stock company that you have not read financial about. Or know a lot about the sector. And the company’s peers and the technology, if there is any.
You should be passionate about the company and what they do. Penny stock investing where you know a lot about the industry is better. If you are an avid gemologist, you may know more about junior miners or precious metal companies.
Are you a person who knows a lot about cannabis? No judgment. Ok, then you might be able to spot a decent cannabis product.
Are you aware of a new video game that is going bonkers on the App Store? If that company is public, you may know something other people don’t.
Use these tools to make sound investment decisions.
Alright, we are ready to get down off our soapbox and talk penny stocks to buy and the top penny stocks right now.
What Are the Best Penny Stocks Right Now?
Ok, these are the penny stocks right now that we think have the most potential moving forward into 2021.
Drive Shack Inc. (DS)
Drive Shack is a company that combines golf with other forms of entertainment for an exciting social experience. Each of their locations features a professional golfing range with fun augmented reality features. They also offer a wide variety of other fun games as well as food and drinks.
Recently, Drive Shack announced a partnership with professional golfer Rory McIlroy to launch an exciting new entertainment brand called the Puttery. This new venture will focus on mini golf, and their first locations will open in summer 2021.
Drive Shack stock shot up over the last week after this partnership was announced. They’ve increased by more than 20 percent from the start of the year, and are now trading for over $3.
This company struggled last year due to the pandemic shutdowns, so this growth is very exciting for investors. As governments start to loosen health restrictions, Drive Shack will be able to reopen all of their facilities at full capacity. This could lead to an increase in revenue and continued share growth.
This exciting entertainment brand is one to keep your eye on moving forward into 2021.
Guardion Health Sciences, Inc. (GHSI)
GHSI is a company with ocular nutrition products and diagnostic tech. The company is coming off a solid quarter.
Q2 revenues for GHSI were $1.19 million, which is a 356% increase from Q2 last year. The growth was from the sale of an immune-related formula to a Malaysian company.
Their Q3 revenues couldn’t quite match these numbers, but their earnings per share did increase. Their share price also hit a year-long high on January 20th, which is promising for this medical company.
In addition for GHSI, ocular health products also saw a 26% increase from the previous year. Unfortunately, the company’s medical device line sales fell by a hefty margin.
Now, these sales were poor because doctor offices around the country were closed. These numbers will increase as we head into 2021 and the stock should see benefits from that.
Vislink Technologies (VISL)
Vislink is a communication technology company that makes video production equipment. They also have government contracts to provide live video and satellite solutions.
This company’s stock has jumped in value recently. They joined the Grass Valley Technology Alliance, which will help with their visibility and standing in the industry. As a result, they saw a small spike in share prices.
Digital entertainment has become increasingly popular as a result of the pandemic. This could lead to increased demand for Vislink’s video equipment.
Additionally, Vislink has a diverse portfolio that contains government contracts. This adds a bit of financial stability during a tough economic time. This is a penny stock to keep an eye on moving forward.
What Are the Most Popular Penny Stocks?
These penny stocks are names you might know from just normal consumer products or stocks that are gaining momentum right now.
ToughBuilt Industries, Inc. (TBLT)
TBLT builds tools and has been selling well on Amazon. In fact, recently, Toughbuilt sold $1.35M through its Amazon U.S. and Canadian storefronts.
Those are nice numbers. And they helped TBLT actually beat revenue estimates for the same quarter. The penny stock company had revenues of $6.86M, a 44% increase year-over-year.
Plus, this number beat the consensus estimate by $0.84M. A lot to like for TBLT.
Lastly, TBLT also just put 64 new products on Rona.com, a Canadian constriction seller. Bags, belts, knee pads, sawhorses, and other items are all being sold on the site. The company said this about the new placement:
“Rona’s great distribution throughout Canada allows us to expand our brand awareness and increase our market share in this growing market. We also believe and look forward to a significant growth in both professional and DIY business in Canada.”
Allied Esports Entertainment (AESE)
Esports have taken the world by storm this year. As people haven’t been able to get together to play games in person, they have turned to the internet for entertainment and social interaction.
Allied Esports is a holding company that runs Allied Esports International and the World Poker Tour. They operate esports arenas around the world and coordinate events.
What makes this stock so exciting is their new streaming platform. They recently launched 24/7 esports programming to meet a huge increase in demand.
As a result, they’ve seen steady increases in their share values throughout December 2020. Their share values could go up even more next year as their physical esports venues reopen.
ENDRA Life Sciences (NDRA)
This biotech company’s shares have skyrocketed over the past week after releasing a new patent. Their stock is now trading for over $2 per share, whereas it was trading for less than $1 per share a week ago.
ENDRA’s products use a combination of ultrasound and radio technology to detect liver disease in its early stages. Since liver disease can lead to other serious chronic health issues, there is a lot of interest surrounding this new patent.
This huge jump in share price is very exciting for investors. Only time will tell if it will lead to an increase in sales, but for now, this is definitely a penny stock to keep your eye on.
What Are The Best Penny Stocks To Buy?
These are the best penny stocks that you should be watching closely. There are numerous catalysts on the horizon for these stocks and you may not want to sit back and chill on these.
Camber Energy, Inc. (CEI) & Viking Energy Group, Inc. (VKIN)
CEI and Viking Energy have an ongoing merger that I think is worth following. Both companies are small oil companies operating in the Texas and Gulf Coast states. Viking also has some notable assets in Kansas.
In this case, Camber will merge into Viking and the latter will be a subsidiary of Camber after the deal. VKIN has done an excellent job of keeping a tight balance sheet over the years, and the company is adept at buying distressed oil assets during a recession.
We are seeing this take shape and VKIN’s James Doris knows how to hedge against downward oil prices. The company logged a net loss of $17.67 million compared to a net income of $1.29 million for the same time last year.
But, this net loss will eventually rebound and the combined oil assets have logged quality production. We see this as a buy-low opportunity on a company (combined company) that knows how to find solid oil assets for cheap.
Rolls Royce Holdings (RYCEY)
Rolls Royce may be known for making cars, but they are also an aerospace company. They are one of the largest manufacturers of airplane engines in the world.
Because of the pandemic, Rolls Royce isn’t getting the orders that they are used to. However, that could all change in the next few years. As airlines get back to flying, it’s likely that they will want to order more planes. Additionally, the Boeing 737 MAX restrictions have meant that companies may want to shift to different planes to replace them.
Their share price has gone up dramatically over the last few months. However, it is still undervalued. This means now could be a great time to buy this penny stock.
The Best Penny Stocks: Final Thoughts
That rounds up my best penny stocks in the market right now.
The market is always shifting and we will be looking for more stocks that we think have value as we move into a new season. Volatility is certainly ahead for the markets, so these picks are safer than some others. Did we miss any stocks that you like? Let us know in the comments.