Are Robinhood Penny Stocks Still Worth Investing in?
Penny stocks are some of the most popular securities to invest in right now. And, Robinhood is a valuable source for buying and selling penny stocks in an easy way. However, there are some limitations alongside the benefits that it offers. For one, buying penny stocks on Robinhood can be challenging as it doesn’t allow access to the OTC exchange. This is where the bulk of penny stocks reside.
However, the term penny stocks itself simply means any stock that is trading under $5. Given that there are hundreds of NASDAQ and NYSE listed stocks under $5, the options are still aplenty.
Now, the next thing to consider is liquidity. While this is sometimes penny stock specific, Robinhood has been known to halt trading when the volume is extremely high. This occurred during the GameStop Corp. (NYSE: GME) fiasco that went down a few months back. But, this is not something we see often, and shouldn’t be too much of a worry.
Now, the next thing to consider is that Robinhood does not truly offer investment tools such as research and analysis beyond face-level information. While this info can be useful, it’s best to have access to your research databases to make tailored investing decisions.
Buying penny stocks in 2021 could not be easier with the number of resources out there. And while Robinhood is not the only platform for buying stocks by any means, it is one of the most popular brokerages out there. With all of this in mind, here are four Robinhood penny stocks to watch in Summer 2021.
4 Robinhood Penny Stocks to Watch Right Now
- Zomedica Corp. (NYSE: ZOM)
- LAIX Inc. (NYSE: LAIX)
- Pieris Pharmaceuticals Inc. (NASDAQ: PIRS)
- Cinedigm Corp. (NASDAQ: CIDM)
Zomedica Corp. (NYSE: ZOM)
Biotech penny stocks like Zomedica Corp. have been in market focus recently. Some biotech penny stocks move up because of trial progress and commercialization of products while others can move based on industry news.
Zomedica tends to be a company that moves off of news and pure speculation. ZOM is also frequently mentioned on the popular subreddit WallStreetBets, adding to its speculative effects. This has turned ZOM into what traders are calling “Reddit penny stocks”.
Before talking about Reddit’s impact on Zomedica, let’s talk about what the company does. Zomedica is a biotech penny stock that focuses on the unmet needs of clinical veterinarians. It develops products for companion animals, such as dogs and cats. It is currently developing and commercializing TRUFORMA, a diagnostic biosensor platform for detecting thyroid disorders in domesticated animals.
The increase in popularity of ZOM due to Reddit is quite impressive. In December 2020, ZOM stock was worth about $0.16 per share. Now as of May 27th, this biotech penny stock is at about $0.80 per share. At one point in February 2021, Zomedica even reached as high as $2.70 per share. While the stock has pulled back, it is still frequently being mentioned all over Reddit.
So what else is impacting ZOM stock apart from Reddit? Well, the company released its first-quarter financial results on May 12th, 2021. It reported a net loss year over year, but solid revenue numbers.
The company had limited sales in the first quarter of 2021. But the company now expects to see revenue increase as sales and marketing activities increase in the coming months. With so much information to consider from this biotech penny stock, will it make it onto your watchlist?
LAIX Inc. (NYSE: LAIX)
LAIX Inc. is a penny stock that provides English learning products and services in China. One of its applications is Liulishuo, which offers leisure learning, standard courses, DongNi English, and other English learning programs. It has a similar app targeted towards kids that enhances the reading, hearing, and speaking abilities of children.
LAIX stock has increased in price significantly after the company released its first-quarter 2021 financial results. LAIX reported a net income of $1.9 million compared to a sizable net loss the year prior.
Its gross margin was 77.6% compared to 65.5% the last year, which is always an encouraging sign. Its net revenue did decrease, along with its sales and marketing expenses year over year. This makes sense given the large effects of the pandemic on all businesses.
“These numbers reiterate our firm commitment and strong execution capabilities when it comes to cost controls. Our focus going forward is to balance profitability by improving operating leverage while at the same time executing our strategic initiatives to propel our operational growth.”
The CEO and Chairman of LAIX Inc., Dr. Yi Wang
With all of this information in mind, will you be adding LAIX to your list of penny stocks to watch?
Pieris Pharmaceuticals Inc. (NASDAQ: PIRS)
Another biotech penny stock that has been performing well in the market is Pieris Pharmaceuticals Inc. This is a clinical-stage company that discovers and develops anticalin protein-based drugs.
These are low molecular-weight therapeutic proteins from lipocalins that are naturally occurring low-molecular weight human proteins found in blood plasma. Its lead products include PRS-060/AZD1402 which is in Phase II clinical trials targeting IL-4Ra for treating asthma and inflammatory diseases.
Recently the company made progress that caused its stock price to shoot up significantly. Pieris will collaborate with Genentech for respiratory and ophthalmology drug development. It will allow Pieris to combine its discovery engine with Genentech’s targets, and its preclinical and clinical development expertise; all aiding in the development of novel compounds.
It will also collaborate to create novel therapies for treating respiratory and ophthalmological diseases. The agreement could additionally nominate several programs for further development. Under the terms, Pieris will get $20 million upfront and is eligible to get more than $1.4 billion in potential milestone payments, as well as royalties for commercialized programs.
“We look forward to working closely with Genentech on the development of new inhaled and ophthalmological treatments based on the Anticalin platform. This collaboration further expands our partnered efforts in respiratory diseases and opens a new avenue for our Anticalin technology to potentially provide patient benefit through local biological effects.”
The CEO of Pieris, Stephen S. Yoder
Since the announcement was made, PIRS stock has gone from about $1.85 per share on average to more than $3.75 per share. Will this company make it on to your list of penny stocks to watch?
Cinedigm Corp. (NASDAQ: CIDM)
Cinedigm Corp. is an entertainment penny stock we have talked about frequently in the past few months. If you have not yet heard of the company let’s get you up to speed.
Cinedigm is a distributor of movie, television, and short-form content in the U.S., Canada, and New Zealand. It owns a large library of distribution rights for digital, physical, home, and mobile entertainment platforms. It also services digital cinema assets on 12,000 domestic and foreign movie screens.
One news announcement that garnered a lot of attention for this penny stock was the announcement of Fandor Selects. Fandor Selects is the world’s first NFT film label. If you’ve been on the internet in 2021, you’ve certainly heard of non-fungible tokens or NFTs at some point. If you haven’t heard of the technology yet, let me explain.
NFTs are digital methods of ownership for works of art, music, trading cards, or almost any original content. It is powered by blockchain which has become vastly popular alongside cryptocurrencies like Ethereum and Bitcoin. After the company announced plans to offer some of its Fandor’s film discography as NFTs, its stock price grew substantially.
Cinedigm also announced another significant update on May 25th adding to its bullish momentum. The company will be collaborating with the Struum streaming service. Struum is a streaming service that is backed by a multi-million-dollar investment by the former Disney CEO, Michael Eisner through his Tornante company. Now Cinedigm’s four most popular digital channels will launch on Struum.
The last bit of news that is helping CIDM perform well in the market is the announcement made on May 27th. Cinedigm stated that its year-over-year growth in total users and minutes viewed for April was very significant on its Dove Channel. Minutes viewed increased more than 85% year over year, while total users grew 72% year over year. With all of this information in mind, will you add CIDM stock to your watchlist?
Which Penny Stocks Are on Your 2021 Watchlist?
Buying penny stocks in 2021 is easier than ever with the help of platforms like Robinhood. Because of this, the rest of the work comes down to doing research and making informed decisions.
As a trader, the best way to identify value in the stock market is by understanding what factors are affecting certain industries. This could be everything from global trends to current events and more. With all of this in mind, which penny stocks are on your 2021 watchlist?