7 Reddit Penny Stocks With Interesting Plans in the Works

Investor curiosity in Reddit penny shares (that’s, penny shares widespread on platforms like r/WallStreetBets) might have peaked a number of months again. Yet, whereas curiosity has light, the development itself has not disappeared. Speculators on-line proceed to chatter about which “scorching shares” are about to make huge strikes increased.

Admittedly, a lot of that is constructed extra on hype, than on precise “game-changing” developments simply round the nook. But, in the case of a few of these names widespread with the Reddit set, they might be onto one thing.

How so? Between firms seizing alternative in the battle in opposition to Covid-19, to firms leaping into the new gold rush (crypto mining), many of those so-called “meme shares” have extra going for them than simply irrational enthusiasm. Their plans is probably not assured to pan out. But, in the event that they do, it may outcome in massive returns for these shopping for these names (a lot of which have pulled again considerably) right now.

So, which Reddit penny shares with formidable plans may repay down the street? Consider these seven high-risk, high-potential performs as ones the place threat/return leans in your favor:

  • American Resources (NASDAQ:AREC)
  • Cinedigm (NASDAQ:CIDM)
  • Ault Global Holdings (NYSEAMERICAN:DPW)
  • Jaguar Health (NASDAQ:JAGX)
  • Naked Brand Group (NASDAQ:NAKD)
  • Precipio Inc. (NASDAQ:PRPO)
  • Support.com (NASDAQ:SPRT)

Reddit Penny Stocks: American Resources (AREC)

Source: J.J. Gouin

At first look, AREC inventory is your run-of-the-mill small-cap fundamental supplies play. The company’s main businesses are concerned in metals recycling and metallurgical carbon. But, as InvestorPlace’s Tom Taulli mentioned final month, its publicity to the uncommon earth metals development could also be the principal attraction.

American Resources’ uncommon earth enterprise continues to be in its early levels. But, as demand for uncommon earth metals heats up, because of the use of such supplies in electronics and electrical car (EV) batteries, this might scale up into a big section for the firm. On prime of that is the projected long-term growth in the use of metallurgical carbon.

Put all of it collectively, and it’s simple to see why Reddit traders went wild for AREC inventory earlier this yr. During “meme inventory insanity,” the inventory went from $2.15 per share, to costs topping $8 per share. However, as the hype has light, shares have given again nearly all of their features, and are at present altering palms for round $3 per share.

This sell-off might have been robust on those that purchased close to the prime. Yet, should you’re simply discovering this inventory now, taking an opportunity on this high-risk play with massive plans may repay down the street.

Cinedigm (CIDM)

CIDM stock

Source: Pavel Kapysh / Shutterstock.com

Cinedigm is probably not a family identify. But, via M&A and partnership offers, it’s slowly changing into a significant identify in the content material streaming area. Sure, this firm isn’t going to present “massive media” powerhouses like Disney (NYSE:DIS) and Viacom (NASDAQ:VIAC) a run for his or her cash anytime quickly.

But, by consolidating impartial media libraries, and constructing out a network of ad-supported streaming channels, it nonetheless stands to ultimately develop into a worthwhile participant on the fringes of the leisure trade. At the very least, it may wind up being an ideal bolt-on acquisition goal for a bigger impartial media firm. Or, develop into one thing private-equity snaps up, in an try and roll-up small and mid-sized streaming firms.

So far this yr, traders have been extra overestimated about its publicity to the NFT (non-fungible token) development. However, over the long-term, the enlargement of its streaming unit is what’s going to present the inventory the most runway.

As NFT mania takes a breather, shares have pulled again. The inventory trades for round $1.30 per share right now. It might take years for this enterprise to interrupt out, however long-term traders might discover this one interesting.

Ault Global Holdings (DPW)

DPW stock

Source: Mark Agnor / Shutterstock.com

What is Ault Global Holdings? It’s sophisticated. You might know of it primarily from its dabbling in the Bitcoin (CCC:BTC-USD) mining area, which it’s getting back into, after getting out of it previous to the current bubble. But, there’s much more happening right here with this Reddit penny inventory than simply crypto mining.

The company’s main units embody Gresham Worldwide (aerospace/protection expertise), and Coolysis Technologies (energy merchandise). Ault additionally holds a seize bag of fairness investments in privately-held and publicly-traded firms. One of notice is their funding in Brooklyn ImmunoTherapeutics (NYSEAMERICAN:BTX), previously often called NTN Buzztime.

Earlier this yr, Ault purchased 295,000 shares again earlier than NTN’s reverse merger with Brooklyn, at an average price of $3.42 per share. Unfortunately, the firm sold off most of its stake in March, nicely earlier than BTX inventory (*7*).

Only time will inform whether or not the fixed wheeling and dealing will repay for DPW inventory. This was a meme inventory itself final winter, when it rallied from underneath $2 per share, as much as as a lot as $10.94 per share. But, following its collapse, taking a bet on it now could also be a long-shot that winds up paying off.

Reddit Penny Stocks: Jaguar Health (JAGX)

Reddit Penny Stocks: JAGX stock

Source: Spyro the Dragon/Shutterstock.com

Even earlier than the peak of meme/Reddit inventory mania, JAGX inventory was a reputation overestimated extensively on-line. The motive? The potential marketability of its Mytesi diarrhea therapy to these experiencing long-haul Covid-19 signs. Speculation over this despatched the inventory on a ten-fold run from mid-December to early-January.

However, since then, shares have taken an enormous dive, and now commerce at round $1.27 per share. The total decline of “meme shares” might have been the principal driver. Yet, some current scorching water the firm has gotten into possible hasn’t helped.

Congresswoman Carolyn Maloney has accused the company of price gouging with Mytesi, which for now could be bought as a therapy for HIV/AIDS sufferers on antivirals. After failing to safe emergency use authorization (EUA) for Covid-related use of Mytesi, Jaguar greater than tripled its per-bottle worth. The product continues to be in the operating for normal FDA (Food and Drug Administration) approval. But, dangerous optics like this will likely damage its prospects of getting such approval.

In quick, proper now issues appear like they’re taking a flip for the worse. The inventory could also be quick headed again to sub-$1 per share worth ranges. But, if it manages to beat the dangerous press, may Mytesi be permitted for long-haul Covid use? Such a change in occasions may gasoline an amazing rebound.

Naked Brand Group (NAKD)

NAKD stock

Source: NazarBazar/Shutterstock.com

Naked Brand Group isn’t going into crypto. Nor is it, hastily, changing into a biotech firm growing therapies/vaccines for Covid-19. But, this purveyor of intimate attire is leaping on one other megatrend, e-commerce.

As you possible know, NAKD inventory grew to become one in all the hottest of the Reddit penny shares again in January, when the firm introduced plans to divest its unprofitable physical store locations, and double-down on its on-line retail unit. Sure, the hype round this information wound as much as be unprofitable for many who purchased the inventory too late.

Briefly hitting costs above $3 per share, Naked inventory has since cratered again to literal pennies (round 55 cents per share). The hype has since left the room. But, these getting in right now could also be doing so at a positive entry level. Why? For starters, when its inventory was buying and selling at inflated ranges, the firm well raised cash via direct offerings.

As a outcome, it’s now sitting on as much as $270 million. Not dangerous, contemplating it now has zero debt, and a $282 million market capitalization. Now, it’s possible going to burn via a lot of its money hoard, given its plans to scale into a significant e-commerce attire retailer. But, with heavy pessimism priced-in, draw back if its ambitions fail to pan out could also be minimal, in comparison with the potential features in its inventory worth if the digital transformation succeeds.

Precipio (PRPO)

PRPO stock

Source: Cryptographer / Shutterstock.com

Less than a month in the past, PRPO inventory was buying and selling for lower than $2 per share. Yet, with current information of its rapid Covid-19 test changing into accessible to be used, shares in this medical merchandise firm have zoomed to close what’s thought-about the prime vary for penny shares ($5 per share).

Sure, this can be a “one and completed” catalyst. That is, now that extra Americans have obtained the vaccine, the nation is presumably inching nearer to herd immunity. If we see a dramatic lower in circumstances, and the path again to the “outdated regular” accelerates, demand for this product might shortly evaporate.

Yet, even short-lived success with the product may repay in the long-run for Precipio. If its makes an honest revenue throughout the temporary window speedy Covid-19 antibody exams are in demand, it may use the money to assist gasoline the additional improvement of the remainder of its diagnostic merchandise pipeline.

After spiking on the first buying and selling day of May, PRPO may pull again farther from right here. But, after it settles down a bit, this under-the-radar identify in the healthcare area with fascinating plans may nonetheless make for an honest alternative for extra risk-hungry traders.

Reddit Penny Stocks: Support.com (SPRT)

Reddit Penny Stocks: SPRT stock

Source: Shutterstock

Last month, I made the case why this firm, at present a supplier of outsourced buyer assist providers, may find yourself being one in all the finest crypto mining performs on the market.

How so? The firm is in the means of merging with privately-held Bitcoin miner Greenidge Generation Holdings. You might not have heard of Greenidge. But, with possession of its personal electrical energy supply, it might have an edge over the better-known crypto mining performs equivalent to Marathon Digital (NASDAQ:MARA) and Riot Blockchain (NASDAQ:RIOT).

Not solely that, with Support.com’s legacy internet working losses (NOL), the mixed firm might be able to shelter a lot of its potential Bitcoin mining earnings from taxation. To prime all of it off, this reverse merger deal could also be priced in favor of current house owners of SPRT inventory.

Sure, though it went parabolic on information of the deal, traders have since taken the cash and run. This might point out that this deal gained’t play out in addition to it appears on paper. Also, if Bitcoin crashes, the bull case for this inventory, together with the different crypto mining performs, will take a severe hit. Yet, for these searching for shares with publicity to this different asset class, a reputation like Support.com could also be the finest approach to play it.

On Penny Stocks and Low-Volume Stocks: With solely the rarest exceptions, InvestorPlace doesn’t publish commentary about firms which have a market cap of lower than $100 million or commerce lower than 100,000 shares every day. That’s as a result of these “penny shares” are regularly the playground for rip-off artists and market manipulators. If we ever do publish commentary on a low-volume inventory that could be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this reality and warn readers of the dangers.

Read More:Penny Stocks — How to Profit Without Getting Scammed 

On the date of publication, Thomas Niel held an extended place in Bitcoin. He didn’t (both immediately or not directly) maintain any positions in the securities talked about in this text.

Thomas Niel, contributor for InvestorPlace.com, has been writing single-stock evaluation for web-based publications since 2016.

Recommended For You

About the Author: Daniel