Markets continue attempting a recovering and penny stocks remain a core focus. While small-cap companies may have taken some of the brunt of this week’s selling pressure, it’s important to note the difference. Not all small-cap stocks are considered penny stocks. On the other hand, not all penny stocks have small market caps. It’s this dynamic that seems to help set stocks under $5 apart from the broader market.
What I mean by this is that benchmark ETFs like the Russell 2000 Small-Cap Index ETF (NYSE: IWM) were hit hard this week. Meanwhile, since Monday morning, the S&P Index ETF (NYSE: SPY) and the Nasdaq Index ETF (NASDAQ: QQQ) both attempted to recover from last week’s dip. However, as you’ll see in this article, just because broader small-cap stocks were fading on Tuesday, it doesn’t mean penny stocks followed suit.
In fact, if you look at some of the top holdings of the IWM, you may be surprised to find that they aren’t even close to the $5 threshold. As of March 22, of the top 10 most heavily weighted holdings in the ETF, the lowest-priced stock trades above $37. This should help illustrate that just because something is labeled “small-cap,” that doesn’t mean they’re definitely a penny stock.
Needless to say, there are plenty of stocks under $5 selling off today getting taken lower by bearish sentiment. However, other penny stocks are trading higher and ones that analysts have given a Buy rating to. Furthermore, price targets also suggest bullish undertones. But just because an analyst says one thing, does that mean they’re correct? I’ll leave that in your hands. For now, here’s a look at 4 penny stocks to buy right now, according to analysts.Penny Stocks To Buy [According To Analysts]
- Oxford Square Capital Corp. (NASDAQ: OXSQ)
- HC2 Holdings Inc. (NYSE: HCHC)
- electroCore Inc. (NASDAQ: ECOR)
- Limelight Networks Inc. (NASDAQ: LLNW)
Analyst firm Ladenburg Thalmann came out with an upgrade today on Oxford Square. The firm boosted its rating to Buy from Neutral. However, no price target was immediately made public.
Shares of OXSQ have been climbing all year. The management investment company focuses on generating strong ROI through investments in debt securities. These include everything from bilateral loans to syndicated loans. Something you’ll notice is that the company doesn’t release much news. But it might not have to. As an investment company, the market seems to have yielded all of the information necessary so far.
In fact, if you look at its most recently filed earnings, you’ll see what I mean. Oxford beat earnings per share estimates as well as sales expectations from analysts. It was expected to deliver an EPS of 9 cents per share. However, Oxford came in with an EPS of $0.10. Sales also climbed higher than expected at $8.64 million compared to the $8 million estimates. This marked yet another quarter where Oxford beat earnings estimates.
In addition to the bullish outlook from analysts, OXSQ could be one of the penny stocks to keep track of right now.Penny Stocks To Buy [According To B. Riley]: HC2 Holdings Inc.
HC2 Holdings Inc. also recently came out with a quarterly earnings and sales beat. The company recorded a loss per share of 11 cents in Q4 of 2020 and sales of $251.80 million. This was much better than analyst expectations of a loss per share of 20 cents on sales of $250 million.
One thing that could be working in its favor is the company’s business model, in general. HC2 is a diversified holding company with a reach in multiple industries. Avie Glazer, Chairman of HC2 emphasized this in the earnings update.
“Each of these operating segments contains best in class assets: Infrastructure is one of the largest steel fabrication and erection companies in the U.S., Life Sciences currently includes two breakthrough healthcare technologies, and Spectrum owns and operates the largest broadcast station group in the U.S. HC2 leadership is committed to supporting their success by fueling their organic and inorganic ambitions, and if and when appropriate, looking for alternative approaches to unlock value.”
Last week Oxford’s portfolio company, DBM Global, acquired The Banker Steel family of companies. Banker Steel provides fabricated structural steel and erection services primarily for the East Coast and Southeast commercial and industrial construction markets. Given the expectation of an infrastructure bill on the Biden administration’s desk, this could be a well-timed roll-up. Right now, B. Riley has a Buy on the stock and a $5 target.Penny Stocks To Buy [According To Maxim Group]: electroCore Inc.
Shares of electroCore Inc. were among a handful of penny stocks in the green on Tuesday. This continued a move that has been in play since early March. Unlike the companies mentioned above, electroCore missed estimates in its recently filed earnings results. Analysts expected a loss per share of ten cents; however, electroCore reported a loss of $0.14 per share. What the company was able to do was beat on sales estimates. electroCore recorded sales of $928,000, whereas analysts expected sales of less than $900,000.
This doesn’t seem to have changed recent analyst ratings, though. Maxim Group currently has a Buy rating on the stock. It also issued a price target of $3 in its most recent update.
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electroCore came out with news this week of a new distribution agreement with Silvert Medical Nv-Sa. This is for territory in Western Europe for the gammaCore Sapphire vagus nerve stimulator. The device is used in patients suffering from primary headache disorders. The territory includes Belgium, Luxembourg, the Netherlands, and France.Penny Stocks To Buy [According To Lake Street Capital]: Limelight Networks Inc.
Finally, Limelight Networks Inc. has mimicked a similar trend as ECOR. The penny stock dipped in early March but has since managed a strong rebound. This move continued on Tuesday as shares reached highs of $3.60 before the lunch hour.
Limelight delivers digital content, video, cloud security, and edge computing services to its clients for some context. The company has put a clear focus on growth this year. In an update earlier this month, Limelight outlined its plan to do so. One of the main highlights was a 16% workforce reduction. The company explained that it expects to report adjusted earnings before items between $20 million and $30 million this year due to cost-cutting and an improved content delivery business.
What do analysts think about LLNW stock? Lake Street Capital is one of the firms covering the company. In its most recent update, analysts gave a Buy rating and a price target of $6, 68% higher than the current trading levels. Keep in mind, just because an analyst gives such a lofty price target, it doesn’t guarantee that it will become the final result.