Is the OTC Market dead? That is the question a lot of traders and investors are asking themselves as the US stock market is flashing red day after day. However, the reality is that markets go through cycles and we’re only at the lowest since mid-October. There are bear and bull markets, and that’s OK.
Similarly, many were saying that crypto was dead after Bitcoin rose to just under $20k in December 2017 and then tumbled to $3100 a year later. Today, we are just under $60k with new highs possible before New Year’s.
Those that abandoned crypto in 2018 are kicking themselves today. Don’t make the same mistake when the OTC gets hot again.
Here are a few investing tips that we always preach:
- Never pigeonhole yourself to just one market. Trade all markets – OTC, NASDAQ, Big Boards, options, and crypto.
- Always book profits along the way.
- Never fall in love with ANY OTC stock. Remember, Amazon didn’t start on the OTC. The chances of your favorite OTC stock becoming the next Amazon are next to nil.
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 penny stocks worth watching right now. They are InnerScope Hearing Technologies, Inc (OTCPK: INND), Palatin Technologies, Inc (NYSE American: PTN), Petros Pharmaceuticals, Inc (NASDAQ: PTPI), and cbdMD, Inc (NYSE American: YCBD).
PENNY STOCKS #1 INND
InnerScope Hearing Technologies, Inc has been bullish at the end of November, but the OTC stock declined over the month. INND has increased almost 9% since last week, although it’s down 24% in November, currently trading at $0.015, which is relatively the same level where we found it the last time we discussed it at the end of October, although it has managed to break above two pennies since then, updating the highest level since mid-June.
The $90 million company produces and distributes FDA (Food and Drug Administration) registered hearing aids, personal sound amplifier products (PSAP’s), hearing-related treatment therapies, doctor-formulated dietary hearing supplements. It is promoting its in-store point-of-sale Free Self-Check Hearing Screening Kiosks, which are designed for the tens of millions of Americans with undetected/untreated mild-to-moderate hearing losses to treat themselves with the company’s easy, convenient, and affordable OTC hearing aids in-store off the shelf and/or Direct to Consumer (DTC) online affordable hearing aid options.
Previously, we reported that INND had entered into a Letter of Intent to buy 100% of the equity in Hearing Assist II LLC, which is Walmart’s largest hearing aid supplier. The deal was completed earlier this week, with the purchase price totaling $10 million equivalent of InnerScope’s restricted shares of common stock subject to a 24-month Leak Out Agreement. The restricted shares are split equally into two different fixed price per share amounts. The first $5 million shares are at a fixed price of $0.0089 per share based on the terms of the LOI executed on October 3. The second $5 million shares are at a fixed price of $0.17 per share.
HearingAssist is an established leader in the DTC hearing aid market with over 500,000 hearing aids sold and top-line revenues of more than $72 Million since 2018 and is Walmart’s largest hearing aid supplier. It will continue to use the brand name and keep the same management team but act as INND’s wholly-owned subsidiary.
$INND sitting down with the team of Hearing Assist, talking about the completion of the Acquisition, & our bright future together on how we plan to take over the market with the combined forces of $INND, @ihear_direct & Hearing Assist
Check out the video👇 pic.twitter.com/PQ5GEIy3jI
— InnerScope Hearing Technologies (OTC: $INND) (@inndstock) November 30, 2021
Floyd Kuriloff, founder of Hearing Assist, said:
“Combining the talents and experience of HearingAssist, with our deep marketing and distribution experience and InnerScope, with its decades of proven track record of retail hearing aid sales and hearing aid R&D manufacturing, will create a powerful disruptive company in the global hearing device market.”
Meanwhile, on December 1, INND said that it had partnered with Giant Eagle Inc, a neighborhood grocery and pharmacy chain, to deploy its automated self-check hearing screening kiosk in Giant Eagle’s supermarkets in Pennsylvania and Ohio.
If you are near Pittsburgh or Monroeville PA / Westlake, Uniontown, Columbus, or Dublin, OH. Get your hearing test @GiantEagle to prove to your family you don't have a #hearingloss 🤣https://t.co/I8OHVH5L7f pic.twitter.com/bBp2iup3XJ
— InnerScope Hearing Technologies (OTC: $INND) (@inndstock) December 1, 2021
Earlier in November, INND partnered with Atlazo Inc to develop next-generation hearing aids and hearable products using Atlazo’s patented Artificial Intelligence (AI) hardware platform. Hearing products powered by Atlazo’s proprietary ultra-low power System-on-Chip (SoC) will offer consumers unprecedented new features, including voice commands, continuous health monitoring, and seamless connectivity with other smart devices.
We see that INND is very active and ambitious, expanding its business to get closer to the 70 million people in North America and the 1.5 billion people worldwide who suffer from hearing impairment and/or hearing-related issues. The company is about to report record revenues for this quarter thanks to the acquisition of Hearing Assist, and we think its share price is undervalued as of today.
PENNY STOCKS #2 PTN
Palatin Technologies, Inc, listed on NYSE American, has almost doubled in price since mid-November when it fell to the lowest year-to-date. The share price surged on Monday to the highest since February, breaking above $0.90, although it has corrected and is now trading at $0.60, a good entry price.
The $140+ million biotech firm develops targeted receptor-specific therapeutics for the treatment of various diseases in the US. PTN develops first-in-class medicines based on molecules that modulate the activity of the melanocortin peptide receptor system. For those unfamiliar, the melanocortin receptor (MCr) system has effects on food intake, metabolism, sexual function, inflammation, and immune system responses. There are five melanocortin receptors, MC1r through MC5r. Modulation of these receptors, through receptor-specific agonists, which activate receptor function, or receptor-specific antagonists, which block receptor function, can have significant pharmacological effects. Many tissues and immune cells located in various organs, such as the eye, gut, and kidney, express melanocortin receptors, providing the opportunity to directly activate natural pathways to resolve disease inflammation.
PTN’s lead product is Vyleesi, a melanocortin receptor (MCr) agonist for the treatment of premenopausal women with hypoactive sexual desire disorder. It is also developing oral PL8177, a selective MC1r agonist peptide that has completed Phase I clinical trial for the treatment of inflammatory bowel diseases.
PTN also engages in the development of PL9643, a peptide melanocortin agonist active at multiple MCrs, including MC1r and MC5r for anti-inflammatory ocular indications, such as dry eye disease; and melanocortin peptides for diabetic retinopathy. On top of that, the company is developing other treatments as well.
On Tuesday, the company announced that the US Patent and Trademark Office had issued a Notice of Allowance for its application No.: 16/927,347. The allowed claims relate to the use of melanocortin peptides to decrease pro-inflammatory cytokine production and expression associated with cytokine storm, a dysregulation of the immune system characterized by undesired cytokine expression, which leads to hyperinflammation. In fact, many viral infections, such as COVID-19, may lead to a cytokine storm, which is in fact the main cause of death in such diseases.
Palatin (NYSE: $PTN) is pleased to announce the USPTO has issued a Notice of Allowance for new intellectual property, relating to use of melanocortin peptides to decrease pro-inflammatory cytokine production & expression associated with cytokine storm. https://t.co/bJKXDS5o7Z
— Palatin Technologies (@PalatinTech) November 30, 2021
Carl Spana, Ph.D., President and CEO of Palatin, commented:
“We continue to strengthen our intellectual property surrounding our melanocortin receptor-1 peptide portfolio, particularly when early data suggest they can help resolve the over production and expression of pro-inflammatory cytokines associated with many diseases, including acute viral infections such as COVID-19. We continue to develop this technology as part of our diversified platform.”
Last month, the company reported its financials for the Q1 of FY 2022 and shared several important updates, such as:
- Phase 3 Pivotal Study of PL9643 in patients with Dry Eye Disease is expected to start this month with top-line results expected in the second half of next year.
- Phase 2 Clinical Study of PL8177 in patients with Ulcerative Colitis Currently expected to start H1 2022 with results expected in H2 of next year.
- Vyleesi net sales surged 98%, net revenue per prescription dispensed was up 45% over the prior quarter.
We think PTN has a bright future and today’s price doesn’t reflect its current situation and potential. At the end of November, H.C. Wainwright analyst Joseph Pantginis increased the price target for PTN stock from $2 to $5 per share. We also like that institutions own about 9% of the stock and that the shares haven’t been diluted.
PENNY STOCKS #3 PTPI
Petros Pharmaceuticals, Inc is another biotech company that is maintaining a bullish stance despite the latest major correction, but unlike PTN, it’s listed on NASDAQ. The share price of PTPI also fell in mid-November to the lowest level this year, close to $1, and then surged to the highest since February at over $5 before correcting to the current level at $2.31.
The $30 million New York-based company focuses on men’s health therapeutics. It engages in the commercialization and development of Stendra (sold as Avanafil), an approved PDE-5 inhibitor prescription medication for the treatment of erectile dysfunction (ED). It also develops and commercializes H100, a patented topical formulation candidate for the treatment of acute Peyronie’s disease, and markets its own line of ED products in the form of vacuum erection device products.
Last month, the company released its financials for the third quarter, providing the following updates:
- Total STENDRA prescription and tablet sales hit record levels in Q3;
- Total STENDRA mg sold in Q3 increased 6% over Q2, which was up 4% over Q1, showing continuing momentum in the market.
- PTPI expanded its program for novel investigational non-invasive treatment formulation for Peyronie’s disease.
The company said:
“Petros continued its momentum during the third quarter with the number of prescriptions and tablets hitting record levels. […] Prescription Medications segment gross sales increased 46% quarter over quarter during the third quarter; however, net sales declined 17% during the same period. Net sales is adjusted for various allowances such as product returns, contract rebates, coupon redemptions and other reasons, related primarily to STENDRA.”
Declining net sales put pressure on the share price, pushing it to the lowest YTD. The price surged to the highest since February but then corrected after PTPI announced a $10 million offering. The company said it had entered into definitive agreements with the largest investor and other existing investors, for the purchase and sale of 3,333,333 shares of its common stock, at a purchase price of $3.00 per share. Petros lso agreed to issue the investors unregistered warrants to acquire 2,500,000 shares of common stock at an exercise price of $3.50 per share, exercisable immediately and terminating 5 years after the date of issuance. The closing of the offering is expected to occur on or about December 2, 2021, subject to the satisfaction of customary closing conditions.
Petros intends to use the funds to expand its men’s health platform and for working capital and general corporate purposes.
With almost 9% of float made up of shorts, PTPI is now turning into a good short squeeze candidate and we may see it updating the YTD soon by consolidating above $5.
You should be ready for increased vitality this month, as the company is about to hold its annual meeting of shareholders on December 22, in which the issuance of an additional 1.5 million shares will be voted. While the potential share dilution can be interpreted as another bearish signal, it can add to the short squeeze narrative.
PENNY STOCKS #4 YCBD
cbdMD, Inc spiked on Monday to $2 but eventually has corrected to the current level at $1.52. Nevertheless, the recent price increase came amid the highest volume figures YTD, as the number of shares changing hands jumped to over 15 million from less than 500k in the previous days. The share price fell on November 23 to the lowest YTD at about $1.3 before bouncing back on Monday.
The NYSE American-listed stock saw its YTD high in February at over $6 and has gradually declined since then. However, this is still a worthy penny stock as it has a healthy balance sheet and great potential.
We shared our bullish case for YCBD in October 2020, giving our subscribers and readers the opportunity to leverage the 4-month rally that led to the February peak close to $7.
cbdMD produces and distributes various cannabidiol products. It owns and operates consumer hemp-based CBD brands, such as cbdMD and Paw CBD. Its cbdMD brand products include CDB tinctures, gummies, topicals, capsules, bath bombs, bath salts, and sleep aids. The company also offers veterinarian-formulated products, including tinctures, chews, and topicals under the Paw CBD brand name. It distributes its products through its e-commerce Website, third-party e-commerce sites, wholesalers, and various brick and mortar retailers in the US.
The latest price spike came after the company announced a multi-year exclusive agreement with Amify, a partner of Amazon.com. The agreement will enable YCBD to include its CBD products within the Amazon marketplace. Amify, which specializes in Amazon go-to-market strategies, content creation, and operational excellence, will act as cbdMD’s exclusive CBD partner to launch products on the Amazon platform as soon as the category is accepted and becomes available. This partnership includes all the leading and award-winning cbdMD branded products, including cbdMD’s gummies, tinctures, gelcaps and topicals, as well as the award-winning Paw CBD animal brand. In addition, the new line of skincare and beauty products under the brand cbdMD Botanicals will also be available.
— Top Stock Alerts (@TopStockAlerts1) November 29, 2021
YCBD Chairman and Co-CEO Martin Sumichrast said:
“As an industry, this is the moment we’ve all been waiting for, and we believe we are close. When a global retailer like Amazon is ready to accept your products, you get your strategy prepared and perfected so you’re ready to go to market as soon as possible. That’s exactly what this partnership represents.”
YCBD is already experiencing strong momentum in revenue and profits, and reaching Amazon means exponential growth. We believe this is a great penny stock to hold for the long run, and we think it’s undervalued.
THE FINAL NOTE
Now is a great opportunity to invest in top penny stocks with great potential. Our job is to identify the best penny stocks with strong fundamentals and let our subscribers pick the ones they like to build a well-diversified portfolio.
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 penny 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.