Will These Penny Stocks Gain In April?
When it comes to investing in penny stocks, the market has changed. The pandemic has already brought in loads of new investors. But with these new investors, we have seen a large number of retail investors join the market. One issue for new traders looking to buy penny stock is the volatility of these assets.
Many will shy away and invest in traditional stocks instead to avoid the "risk." But if you can handle some risk, penny stocks may be a great option. They often do not follow the same trends as regular-priced stocks either.
For example, if the stock market is having a bad day, there are still plenty of penny stocks performing well. A lot of this has to do with the micro-trends of smaller stocks. For example, if you look at tech, it isn't just the broad secular trends that blue-chips follow. Since we're usually talking about early-stage companies, many businesses are building novel products, technologies, services, and the like.
Penny Stocks & New Tech: Crypto, Blockchain, & NFTs
The latest trend in tech, for instance, has traders looking at digital currency such as Bitcoin. Blockchain technology is still fairly new, and when new ideas come around, they can often take off as well. In the last month, we have seen the popularity explosion of non-fungible tokens, aka NFTs.
NFTs are essentially one-of-a-kind works, such as music, art, and more. Most of the NFT hype has been in the art space. One NFT by artist Beeple sold for $69 million earlier this month. The growth of NFTs is clear at the moment, and companies launching their own are seeing increases in stock price. This has created a new segment to take a look at, NFT penny stocks.
While not all names on the list are directly related to NFTs, the trend it has created is impacting everything from digital currency stocks to entertainment stocks & everything in between
Are These Tech Penny Stocks To Buy Or Avoid Right Now?
- Cinedigm Corp. (NASDAQ: CIDM)
- Greenpro Capital Corp. (NASDAQ: GRNQ)
- Qudian Inc. (NYSE: QD)
- Atari (OTC: PONGF)
1. Cinedigm Corp. (NASDAQ: CIDM)
The first penny stock on this list has now been tossed into the NFT category. Cinedigm is an entertainment company that usually focuses on movies, television, and other types of digital content. There is a company called Wizard World that holds a small interest in this entertainment corporation. This company, Wizard World, has now announced that it will be creating NFTs. It will use all of its media, such as convention videos, to sell as non-fungible tokens.
Now Cinedigm itself plans on offering NFTs too. The company stated, "Given our extensive film library, deep connection to fandom and collectibles, and $CIDM's strong brand partnerships and technology capabilities, I have directed our product team to develop new NFT products to enhance the user experience of our loyal audiences."
After this announcement, the CIDM stock price went from $1.62 to over $2 a share the next day. This week CIDM stock is back in motion after a few new catalysts. First Director Pat O'Brien reported the purchase of over 56,000 shares at an average price of $2.01. Furthermore, an 8-K filed Tuesday showed that the company entered into an equipment purchase agreement to provide American Multi-Cinema Inc. to purchase certain digital cinema equipment over time. The purchase agreement is valued at more than $10 million.
2. Greenpro Capital Corp. (NASDAQ: GRNQ)
The next penny stock is Greenpro Capital Corp. Greenpro is a finance and technology corporation that works in consulting, banking, its CryptoSX platform, and more. The company has not specifically stated it will be entering the non-fungible token scene, but some have speculated on the idea.
Greenpro signed an agreement with crypto technology company Innovest Energy Fund. In addition to this, its CryptoSX platform is involved heavily with crypto. The company has made it clear it is looking to enter this market in a big way. Greenpro has been making other advancements outside of crypto as well.
On March 12th, the company entered a strategic collaboration agreement with iBizzCloud AI-Robotax. The company's services will complement each other, iBizzCloud servers more than 150,000 people every year.
CEO of Greenpro, Dr. CK Lee, stated that "this collaboration will complement the services and products of both Greenpro and iBizzCloud. Each respective business will 'cross sell' to the others customers."
3. Qudian Inc. (NYSE: QD)
Now let's talk about another penny stock that is making market moves. Qudian Inc. is a financial company that provides credit products in China. It uses things like machine learning and artificial intelligence to improve the experience for customers. This company has given multiple updates recently. For example, on March 29th, Qudian released its full-year and fourth-quarter financial results.
These results were not great. Its revenue fell 58.3% year over year. It experienced a total net income decrease of 70%, but its income grew 427% year over year in the fourth quarter. So Qudian could potentially be poised to correct a few things in the new year on the back of Q4 momentum. Chairman and CEO Mr. Min Luo, stated, "Despite pandemic-driven uncertainty and challenging market conditions as well as a continuously shifting regulatory environment, we were able to conclude 2020 with further improvements in our asset quality as we remained vigilant in our cash credit business operation."
Cryptocurrency seems to be the future of finance. As a company mostly operating in digital finances, some believe Qudian could potentially enter the crypto market at some point.
4. Atari (OTC: PONGF)
Another one of the NFT penny stocks to watch is one of the originators when it comes to video games. This entertainment company has been around for generations now, creating games such as Pong, Asteroids, and many other classics.
Atari has had its eyes set on launching its Atari VCS console. This system offers gaming and entertainment but has also implemented its Atari Token for in-game purchases. The company sees the potential in tokenization, entering the market from multiple different points.
The company just partnered with company Bondly to create gaming NFTs. Together they will roll out a full line of Atari Metaverse NFTs, including tokens for gaming, music, and more. The CEO of the company, Frederic Chesnais, stated this about the partnership, "Our collaboration with Bondly is absolutely integral to the success of the upcoming collections of NFTs and of the Atari metaverse."
Included in Atari's other crypto ventures is the partnership with online casino builder Decentral Games. Atari and Decentral will create a cryptocurrency casino in 'Vegas City,' a district of the Etherium-based Decentraland virtual world. This is not the end of Atari's crypto ventures but just the most recent of them all. It will be interesting to see what NFTs are released by Atari and how it will affect PONGF stock price.
As a result of these recent crypto ventures, PONGF stock has gone from $0.80 to $0.97 a share as of March 30th. Just one month ago, the penny stock was trading under $0.45 a share.
Penny Stocks To Watch If Tech Bounces
There are no guarantees that any penny stocks will rebound with tech. But it is a good idea to understand current market trends and identify what traders are researching. If you look at some of the popular discussion forums and a few select chatrooms, there've been topics covering niches in tech. Digital currency, blockchain, and NFTs are all among the popular topics right now. Let's see if bullishness in these micro-sectors brings the broader tech sector back from the dead in April.
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