Over the past week or so, penny stocks have gained quite a lot of momentum. This is an exciting sign as the past two months have not been the kindest to investors. With lower than average volume, and most days seeing the market trading sideways, trading penny stocks has been difficult.
However, as the Summer is upon us, many investors are excited about a post-pandemic market boom. This excitement has been seen over the past few days with BB stock, AMC stock, and other ‘meme stocks’ as they are colloquially known. For those unfamiliar with this term, meme stock applies to any stocks that are highly trending on social media.
This began with GME stock, following its major rise in value due to Reddit traders. However, since then, many stocks have come close in terms of fast-paced bullish sentiment. One thing to keep in mind is that meme stocks tend to be more volatile than most. And if we add penny stocks into that, we see the volatility become even higher. But, with great volatility comes great potential to see profits (and losses).
Most investors tend to use penny stocks as a short-term financial instrument. Because of this, speculation and large price fluctuations are important to this strategy. At the end of the day, making money with penny stocks is all about understanding how the market works and how to trade. With that in mind, let’s take a look at three great penny stocks to watch today that could rival AMC, BB, and GME.3 Great Penny Stocks to Watch Right Now
- NextDecade Corp. (NASDAQ: NEXT)
- Digital Ally Inc. (NASDAQ: DGLY)
- Sonim Technologies Inc. (NASDAQ: SONM)
Up by a staggering 54% in morning trading is NextDecade Corp. We covered NEXT stock only a few days ago, after rising in the low double-digit percentage points. However, as of June 8th, NEXT is no longer considered a penny stock if it closes above $5 per share.
While large gains with penny stocks can be common, we don’t usually see an over 50% gain in one day. To explain this, let’s take a closer look at NEXT stock. Today, a research report came out from Morgan Stanley, putting a major bullish rating on NextDecade of ‘Overweight’. Additionally, the analyst firm upgraded its price target for NEXT stock to $6 from $2.
The reason behind this is that Morgan Stanley believes the energy sector is recovering. And, lower than usual supplies, could result in increased demand. If we use simple finance principles, high demand and low supply mean higher prices. So, while this may take some time, NextDecade is positioned well to take advantage. And, the company’s recently announced major carbon capture project is another added value prospect for investors to consider.
This analyst rating increase, however, comes only a few days after Sean Morgan at Evercore ISI, became bullish on NEXT stock, also tripling the price target. Since June 1st, shares of NEXT are up by over 150%. And let’s not forget that June 1st was only one week ago. Considering this, will NextDecade be on your list of penny stocks to watch?Digital Ally Inc. (NASDAQ: DGLY)
Another big gainer of the day so far is DGLY stock, pushing up by around 10% in morning trading. This move comes as the company announced the formation of a new business unit to diversify its model. For some context, Digital designs and manufactures high-quality video recording hardware and analytic software. Its products are in use across law enforcement, emergency management, fleet safety, event security, and more.
Last year, Digital Ally announced the Shield Health Protection Product line. The goal with this is to provide PPE such as disinfectants, electrostatic sprayers, and more for use against Covid-19. Going back to today’s announcement, the company created Digital Ally Healthcare Inc. With this, it will move toward creating products for use in the healthcare industry.
“Healthcare represented approximately $3.5 trillion or 18% of the U.S. economy annually. Last year we added the Shield Health Protection Products line to address parts of the health and wellness market.
The shield line includes Shield Cleansers, a highly effective, yet safe, disinfectant and sanitizer for use against SARS-CoV-2, a non-contact thermometer/controlled-entry device, an electrostatic sprayer for fast and efficient disinfecting of large areas, and a variety of personal protective equipment including face masks, gloves, and sanitizer wipes.”Stan Ross, CEO of Digital Ally
The move mentioned above comes alongside Digital Healthcare entering into a venture with Nobility LLC to move even further into the health market. Digital Healthcare will place $13.5 million in cash into the venture to begin acquiring RCM companies. Considering these big moves, will DGLY stock be on your watchlist this month?Sonim Technologies Inc. (NASDAQ: SONM)
Up almost 18% in morning trading are shares of the tech penny stock, SONM. Today, Sonim announced that it and Mem-Star rugged will “bring Sonim’s ultra-rugged XP8 smartphone and XP5s feature phone to the United Kingdom through [the] Crown Commercial Service Purchasing Platform.”
For those who don’t know, Sonim is a U.S.-based provider of rugged mobility solutions for various workforce applications. This includes rugged mobile phones, handheld barcode scanners, tablets, and a whole slew of applications to back them.
Today’s move is a great example of the company working tirelessly to commercialize its products further. And while it does have a large market presence in the U.S., building an international demand for its products will be a major benefit to the company. In its first-quarter 2021 report, announced last month, Sonim brought in net revenue of around $12.2 million. Additionally, it managed to increase its gross profit by 14% year over year, while albeit pulling in a GAAP net loss of $9.3 million.
In May, Sonim also announced its RS60 handheld computer and barcode scanner. Because this product was only released last month, it could take some time before commercialization takes place. But, with the need for ultra-rugged mobile solutions increasing daily, SONM is well-positioned to take advantage. If it can continue to secure contracts both in the U.S. and globally, there’s no telling how far SONM could go. In the meantime, Sonim Technologies could be worth watching.Will The Market Continue to Turn Bullish for Penny Stocks?
As we move further into the Summer, June is already shaping up to be a great month for the stock market. With plenty of penny stocks pushing big gains today, investors remain hopeful for the coming months.
Understanding how to buy and sell penny stocks, however, will always be your best chance at seeing long-term success. And with a trading education to back you, making money with small caps can be completely possible. Considering this, what do you think? Will the market continue to turn bullish for penny stocks?