Due to its growing popularity, many novice investors are beginning to buy penny stocks on Robinhood. The California-based company provides a quick and easy platform that is perfect for day traders.
The mobile application itself has caught the attention of millennials. In fact, 40% of Robinhood’s 12 million users are between the ages of 19 and 34.
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Popular Penny Stocks on Robinhood
Penny stocks are a staple for many investors on Robinhood and for good reason. However, many young investors aren’t familiar with these types of stock.
What is a penny stock? It’s a small company’s stock that typically trades for less than $5 a share. These stocks are sometimes referred to as nano-cap stocks, micro-cap stocks or OTC stocks.
Penny stocks on Robinhood are even more appetizing to its users, mainly because of its demographics. Younger, more inexperienced investors are typically trading with less money. Therefore, they are more likely to have an interest in penny stocks at first.
This is actually a great way to learn more about day trading and the market overall. There’s also an opportunity to bring in huge returns.
Below is a list of the top five penny stocks on Robinhood to watch in 2020. From education companies to the booming marijuana industry, there are loads of penny stocks that have great growth potential in the near future.
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5. Polar Power, Inc.
Polar Power, Inc. (NYSE: POLA) designs and manufactures power and cooling systems for targeted market applications in various fields. This includes the military, telecommunications, renewable energy, marine, automotive and oil field applications. The company was founded in Washington state in 1979 and is now located in California.
Polar Power stock is currently trading at $3.07 after ending 2019 at $2.38. However, this is more of a long-term play. It’s 52-week high is $5.25 and I wouldn’t be surprised to see the current price creep closer to that number again. According to Nasdaq, Polar Power had an EPS growth of 106% over the last reported quarter.
4. Barnes & Noble Education, Inc.
Barnes & Noble Education, Inc. (NYSE: BNED) is a popular brand-name penny stock on Robinhood. Since 2015, the education sector of Barnes & Noble has seen substantial growth while acquiring LoudCloud, MBS, Promoversity, Student Brands and Paper Rater. The company also launched Bartleby, which internally develops direct-to-student digital solutions.
BNED stock has faltered to start 2020 as it now sits at $3.21 per share. It was as high as $5.04 in late November, but has slowly dropped off since.
Yet, this stock is intriguing for many reasons. In December, the company announced it would be reviewing its “strategic options” going forward. This could mean a new acquisition is in the works or a possible merger. Keep watch on this penny stock throughout the year.
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3. Aurora Cannabis
2019 was a pretty good year for the marijuana and CBD industry. Aurora Cannabis (NYSE: ACB) wasn’t on the receiving end of these gains, however. Their stock plummeted throughout the year, from $6.93 per share a year ago to $1.94 today.
These numbers are very concerning, but there’s light at the end of the tunnel. According to The Balance, Aurora has $150 million in current assets and only $75 million in current liabilities.
Moreover, they brought in a net revenue of $98.9 million in Q4 of 2019, up 52% from Q3. Now could be a great time to take advantage of the share price, which could rise rapidly in 2020.
2. Tyme Technologies
Tyme Technologies (NYSE: TYME) is an emerging bio-tech company that develops cancer therapeutics with low toxicity profiles. In addition, one of their main goals is to provide therapeutics that are effective across a broad range of cancer tumor types.
Tyme has a 52-week low of $0.92 and a high of $3.42. It currently sits at $1.47, but that could change quickly. The company announced they are collaborating with Eagle Pharmaceuticals, Inc. (NYSE: EGRX) to co-promote Tyme’s investigational cancer treatment. As a result, Tyme will receive $20 million in milestone payments if certain points are met.
This collaboration could make Tyme one of the best penny stocks on Robinhood. While they are down 54% over the last year, Eagle Pharmaceuticals is up 40%.
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1. Globalstar, Inc.
Globalstar, Inc. (NYSE: GSAT) is a satellite communications company that is beginning to catch the eyes of investors. At $0.50 per share, there is a lot of upside to this company which has surged 7% at the start of 2020.
This recent price action is very encouraging for day traders. Their yearly ESP growth of 98.30% is also a good sign moving forward. Major holders are beginning to increase their shares, including Vanguard Group, Inc. this quarter. Vanguard increased their stake by 19.23% and now owns 52.06 million shares of GSAT.