The US economy is doing really great following the relaxation of lockdown measures and the rollout of the vaccination program. At the end of July, GDP data showed that the economy returned to pre-pandemic levels, even though growth was slower than expected.
A more positive report came on Friday, with the US Labor Department announcing that job growth had accelerated last month by the most in about a year. Payrolls surged 943,000, which is way more than the expected gain of 870,000 jobs. Meanwhile, the unemployment rate declined to 5.4%.
Seema Shah, chief strategist at Principal Global Investors, told Reuters:
“It’s exactly the kind of report that the market wanted, in that it is strong. It suggests that a labor market recovery is in play but also not so strong that it’s going to push forward the timings of the Fed tapering. That is goldilocks, that perfect mix of strong but not too strong.”
The stock market indexes reacted positively to the much-awaited Nonfarm Payrolls report. NASDAQ continues to fluctuate near its all-time high. This is really a great time to invest in penny stocks.
FINDING OPPORTUNITIES IN PENNY STOCKS
There are plenty of opportunities for investors if they follow us here at Insider Financial.
The key to trading stocks is finding the momentum BEFORE it happens and then be patient. Now, when we say that we find momentum BEFORE it happens, we are investors looking to position our subscribers BEFORE the move happens.
It’s also best to own a portfolio of hot stocks. For some that can be as many as 10 to 20 or more hot stocks that include both OTC stocks and NASDAQ penny stocks.
We alert our subscribers with our best ideas before our regular readers. This is the value of having a subscription to Insider Financial, which you can sign up for here.
The fact is that there is always a bull market somewhere. That’s why it’s important for penny stock investors to trade both OTC and NASDAQ stocks, and sometimes get exposure to larger companies that still seem to have massive growth potential. There are always opportunities if you give yourself the flexibility to trade all markets.
In this article, we take a look at 4 hot NASDAQ penny stocks. They are Sphere 3D Corp (NASDAQ: ANY), Future FinTech Group Inc (NASDAQ: FTFT), Kaixin Auto Holdings (NASDAQ: KXIN), and SCWorx Corp (NASDAQ: WORX).
NASDAQ Penny Stocks to Watch #1 ANY
Sphere 3D Corp has surged at the end of this week, with the share price opening below $3.20 on Thursday and closing the week above $4.80, peaking on Friday at $5, which is the highest level since 2018. We believe the uptrend is sustainable, as the share price can consolidate well above $5.
The company delivers containerization, virtualization, and data management solutions via hybrid cloud, cloud, and on-premise implementations through its global reseller network and professional services organization. Sphere 3D, together with wholly-owned subsidiaries Overland Storage and Tandberg Data, manage a strong portfolio of brands, including Overland-Tandberg, HVE ConneXions, and UCX ConneXions.
Besides its main business, ANY is getting into Bitcoin mining. In fact, the latest share price surge has to do with an announcement related to its crypto mining operations. Specifically, on August 5, Sphere 3D entered into an agreement with Hertford Advisors Ltd, a privately-held company that provides mining solutions, to provide a 6-month exclusive right to assume all of Hertford’s rights to a number of Bitcoin mining agreements.
ANY said that it had successfully assumed and executed the first Bitcoin Agreement directly with the manufacturer, for the purchase of up to 60,000 new Bitcoin miners, with deliveries to start in November and continue over the course of the next ten months. Upon completion, this will give the company 5.7 Exahash of computing power.
Sphere 3D CEO, Peter Tassiopoulos, stated:
“This is a significant milestone for Sphere 3D as we look to the future. We are pleased to have the opportunity to place Sphere 3D as a leader in the space with state of the art miners, in a very competitive market where time to delivery is paramount. We continue to look for ways to increase shareholder value while remaining true to our commitment to ESG principles. We believe that this series of transactions could have significant revenue and cost synergies across our value chain.”
In exchange for the assignment of the contracts from Hertford, Sphere 3D will issue to Hertford common shares, as well as shares of a new series of preferred stock in the company, based upon the achievement of certain milestones, which include the assumption of two additional contracts for the purchase of up to an additional 160,000 miners (for a total of 220,000), and the right to complete negotiations to secure a long-term contract for a 200,000 square foot crypto mining facility to be supplied with up to 1GW of carbon-neutral power and 1GW of power from the grid as backup, for which the lessor will contractually agree to offset all carbon emissions when grid power is utilized.
If all contracts are executed, ANY will have 21.5 Exahash computing power. Upon assignment of the contracts, ANY will issue an aggregate of 4,500,000 Common Shares to Hertford.
Thanks to this contract, ANY may become a major player in North America’s Bitcoin mining market. Recently, China cracked down on Bitcoin mining operations, which was a big blow for the market as the country accounted for over 50% of global mining. China’s move has benefited Bitcoin miners, with the mining difficulty level tumbling to the lowest level since the beginning of 2020.
Now it’s a great time for miners not only because of declining difficulty but an increase in the price of Bitcoin, which fluctuates above $40,000. The cryptocurrency may continue to increase due to its store-of-value capabilities, which is relevant especially amid inflation fears.
All in all, this is some great stuff for ANY that might support its long-term growth. This is a NASDAQ penny stock that deserves your attention.
NASDAQ Penny Stocks to Watch #2 FTFT
Future FinTech Group Inc is another NASDAQ penny stock that has surged at the end of this week. The share price opened at $2.41 on Friday and peaked at $3.69, gaining over 50% in only a few hours. Prior to that, the stock was correcting since mid-June and bottomed out at the end of July at $2.28. It hit a YTD high in mid-February at over $10.50, so there is much room for growth.
It’s not clear what has driven the share price of FTFT on Friday, but this might have to do with the general bullishness of the crypto market, with Bitcoin hitting the highest level since mid-May. As a blockchain business, FTFT benefits from the hype around the technology.
FTFT is promoting itself as a blockchain technology R&D and application company. The operation of the company includes a blockchain-based online shopping mall platform called Chain Cloud Mall (CCM), an incubator for blockchain-based application projects, a digital payment system called DCON, and a cross-border e-Commerce platform known as NONOGIRL. The Company is also engaged in the development of blockchain-based e-Commerce technology as well as financial technology.
At the end of June, FTFT registered a new subsidiary, FTFT Capital Investments LLC, to do business in Dubai, UAE. The company plans to operate digital currency trading services and crypto asset management businesses in Dubai, which is probably the most blockchain-friendly city as of today.
FTFT said that it would be positioning itself to become a full financial service provider utilizing blockchain to build a financial services platform to offer diversified financial products to global institutional investors and high net-worth investors. As disclosed in March of this year, FTFT signed a strategic cooperation agreement with major shareholders of Shenzhen SOSOB Technology Co., Ltd. to incorporate a joint venture in Dubai.
While FTFT has several operations as discussed above, the crypto trading business headquartered in Dubai seems to be a promising one. We think the company has a bright future as it taps into the fastest-growing market. This NASDAQ stock is available at a bargain price right now.
In mid-June, the company hired Nobel Prize Winner Finn E. Kydland as Honorary Chief Economist. Dr. Kydland received the Nobel Prize in economics in 2004 for his contributions to dynamic macroeconomics, the consistency of economic policy over time and the driving forces behind business cycles. Besides his several positions, Kydland is an associate researcher at the Federal Reserve Bank of Dallas and the Federal Reserve Bank of Cleveland.
NASDAQ Penny Stocks to Watch #3 KXIN
China-based Kaixin Auto Holdings also surged on Friday, gaining 89% during the day to close at $3.16 after peaking above $3.40, which was the highest level since mid-July, when the NASDAQ-listed stock hit its YTD high at $4.80.
The share price was driven by the news that Kaixin had decided to establish a new energy vehicle (EV) business unit, which will quickly build up EV R&D, production, and marketing teams.
The strategic move comes at a time when the Chinese government provides much support for accelerated development of EVs and amid the rapid growth of EV market in China. Considering Chinese consumers’ ever-increasing recognition of EV, new electric vehicles are expected to become the mainstream consumer model in the auto industry.
KXIN said that it has already been engaged in negotiations of mergers and acquisitions with a number of EV manufacturers. The company said it would reveal more details about any potential M&A deal.
Kaixin said that it was committed to becoming another player in the EV business following Nio, and Xpeng, both of which currently trade at over $40 per share after trading below $20 in 2020.
As for its current business, Kaixin runs dealership networks in the premium used car segment and new car sales in China.
If KXIN succeeds with its EV unit, this NASDAQ penny stock is definitely a great buy with long-term potential.
NASDAQ Penny Stocks to Watch #4 WORX
SCWorx Corp has been bullish this week, updating the highest level since August 2020. The share price rose over 105% during the last month and touched its YTD high on Friday at $3.38. The price broke above $3.00 in mid-July but failed to consolidate there.
The $32 million NASDAQ-listed company provides data management services to healthcare providers, mostly in the New York state.
Despite the recent bullishness, WORX is one of the most shorted stocks right now, and it might be the ideal candidate for a short squeeze due to its low share price for a NASDAQ-listed stock. The company’s short interest ratio has jumped to 58%.
With only a few catalysts, buyers can put much pressure on sellers, forcing the latter to exit their short positions en masse, which is basically the definition of a short squeeze scenario. For example, besides providing data and software services to the healthcare sector, it also provides masks to hospitals. Its masks are used by doctors treating patients with COIVD-19, which might be a catalyst considering the rapid spread of the Delta variant.
— Samuel Peterson (@realsampeterson) July 30, 2021
Earlier this year, the company had some issues with NASDAQ, but it has regained compliance with the listing requirements at the end of May, after releasing the annual report. At the same time, WORX appointed Tim Hannibal, the company’s President and COO, as the new CEO.
While WORX may be a good short squeeze candidate, you should monitor the share price reaction to the potential bad publicity. Last month, Former Attorney General of Louisiana, Charles C. Foti, a partner at the law firm of Kahn Swick & Foti, LLC (KSF), said that KSF has started an investigation into WORX, which relates to a purchase order from Rethink My Healthcare announced in April 2020. The deal, which involved rapid testing kits, was worth hundreds of millions of US dollars, but Hindenburg Research issued a report casting doubt on the deal, calling it “completely bogus,” saying that the test supplier (WORX) was “laden with red flags” and that the CEO had allegedly “falsified his medical credentials.”
On April 30, 2020, the company disclosed that RMH had terminated the purchase order for the COVID-19 test kits. WORX had been sued in a securities class action lawsuit for failing to disclose material information, violating federal securities laws.
Today, WORX has a new CEO and is compliant with the NASDAQ requirements. It may be a good stock to hold at least in the medium term, considering the pressure on shorts.
THE FINAL NOTE
Today is a great opportunity to benefit from the stock market’s bullishness and invest in hot stocks with great potential during a reviving economy. Our job is to identify the best stock alerts with strong fundamentals and let our subscribers pick the ones they like to build a well-diversified portfolio oriented at penny stocks.
The 4 NASDAQ penny stocks discussed today are on the rise and are good stocks to hold. Nevertheless, our best advice is to be patient and enter the market during corrections. Buying dips and selling rips as swing trades remains the best strategy in the stock market. Still, whenever a hot stock is in the middle of a bull run, we recommend our subscribers to book profits.
It’s very important to eye penny stocks that have room for growth and have yet to make their explosive move. There are plenty of opportunities, and we take our time to monitor hundreds of penny stocks to buy each week, trying to find the best alerts for our subscribers.
Remember, all you need is one or two hot stocks to run in order to crush the market averages.
As always, good luck to all (except the shorts)!
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Disclosure: We have no position in any of the securities mentioned. We wrote this article ourselves and it expresses our own opinions. We are not receiving compensation for it. We have no business relationship with any company whose stock is mentioned in this article. Insider Financial is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. This article is not a solicitation or recommendation to buy, sell, or hold securities. This article is meant for informational and educational purposes only and does not provide investment advice.