Today we’re going to look at some of the more popular penny stocks on Robhinhood but before we do lets briefly cover who Robinhood is and what penny stocks are.
Who is Robinhood?
“It’s Time to Do Money” is a mantra by Robinhood, which is a leader in commission-free investments. Robinhood offers you access to trade and multiple channels to gain more money. The company’s products include:
- Stocks and funds: Acquire mobile accessibility to markets. Trade commission-free in companies or investment bundles (ETFs).
- Options trading: Increase your trading levels with this product, which is fast, direct, and commission-free.
- Robinhood Gold: Access expert research documents, invest in margin, and make larger instant deposits from $5 per month.
- Cash management: Trade, use, and earn 1.80% APY, which may vary at the discretion of the program banks.
- Robinhood Crypto: Purchase and sell Dogecoin, Ethereum, Bitcoin, among other cryptocurrencies commission-free and on a daily basis.
The Robinhood trading app was founded in 2013 and has continued to attract over 6 million customers and has a market valuation of $7.6 billion.
Robinhood’s simplicity facilitates the ease of use with reference to the app and the website.
Charging no commissions is quite appealing to investors who are very conscious of costs and trade in small quantities.
In reality, the offerings are light on evaluation and research, and there are severe concerns on the trade executions’ quality.
What are penny stocks?
According to the United States’ Securities and Exchange Commission, penny stocks describe small companies’ low-priced shares. They may trade infrequently, which implies that it may be hard to sell the shares once they are in your possession. Additionally, they may be impractical to correctly price since it may also be problematic to locate quotations.
In general, penny stocks trade over the counter, but they can also trade on foreign exchanges, as well as U.S. facilities and securities exchanges.
- Obtain knowledge about the market where penny stocks trade to establish the level of demand and the difficulty in selling.
- Be particularly keen in the event your broker offers to sell you penny stocks that are newly issued and lacks established investment market.
Caution: Penny stocks can be quite risky!
One of the most significant risks of transacting penny stocks lies in its extremely low liquidity levels. Despite the fact that it may be simple to buy penny stocks, you may incur difficulties in getting a buyer later on.
Therefore, you could be forced to sell the shares at a considerably lower price as compared to the actual market value.
Now we’ll look at some of the more popular penny stocks on Robinhood.
Popular penny stocks on Robinhood
Callon Petroleum Company ($CPE)
- Callon Petroleum Company is a Houston based gas and oil company. It has been in business since 1950 and has had its operations in Permian Basin since 2009.
- This company has proven itself as a highly adaptable company, as shown by its bottom-line results. Sales hit a 10-year high from 2017-2018, soaring 60% in just one year.
- Callon Petroleum Company is currently trading at $3.97 per share, and analysts highlight that this penny stock has a 202% potential upside over the next year. Besides, it is currently valued at $4.40.
- In the second quarter, the company reported a 40% annual increase in production and a 25% million decrease in spending.
ECA- Encana Corporation ($ECA)
- Founded in 2002, Encana Corporation (ECA) is a Canadian natural gas and oil firm. Despite being a penny stock, this company made its way on the Forbes Global 2000 list.
- In 2018, ECA produced 1.58 billion cubic feet of natural gas and 89,900 barrels of oil daily.
- ECA’s gross profits have rocketed 100% in the last three years. Consequently, analysts forecast the stock will trade at $418 per share and will grow to $21, a whopping 402 upside in the next 12 months.
- In a recent trading session, this company’s stock changed position at 3.84% to a closing price of $4.33.
- Stockholders of record will on Friday, December 13, be paid a dividend of 0.025 per share. This signifies a dividend yield of 1.62% and a $0.10 dividend on an annualized basis.
Nokia Corporation ($NOK)
- Nokia Corporation is a Finnish multinational consumer electronics, information technology, and telecommunications company. Founded in 1865, this company has operated in various industries for more than 150 years. For several years now, Nokia has been snowed under by sluggish margin performance and stagnant revenue growth.
- This year, NOK stock has gone down 15%, and the company now trades more than 25% below the highs of 2019.
- Although 5G is expected in 2020 and 2021, Nokia stock has a long way to go. Instead, through 2019, the stock continues to underperform.
- Nokia, whose shares have lost two-thirds of their worth despite its bouncing back nearly 60% from the recent lows, the company trades at $2.50 a share. Efforts to regain traction in the smartphone market cannot be ignored.
Southwestern Energy Company ($SWN)
- With its headquarters in Texas, Southwestern Energy Company is a natural gas production and exploration company. As of December 31, 2016, the company’s estimated proved oil and natural gas reserves were 5,253 billions of cubic feet equivalent.
- In a recent trading session, the SWN stock changed position at 3.72% to a closing price of $2.23.
- In the past month, the stock has experienced a 3.7% decline to $1.82, with approximately 20 million shares changing hands.
- This company began at an opening price of 1.90 and hit a high of $1.92 and a low of $1.76, trading at $0.07 per share.
- SWN stock looks cheap due to the growing book or earnings value. Even after a bounce steered by bottom timers and short covering, shares have fallen 56% the past year, and the company has lost nearly 95% of its value in the last five years.
Robinhood offers are unmatched: EFT trades, cryptocurrency investments, options, and commission-free stock. The app is easy to use; however, it lacks crucial elements such as trading or research tools. There is no account minimum, which means that as an investor, you can begin right away.
These popular penny stocks on Robinhood are worth keeping an eye on.