5 Top Penny Stock Picks In 2020 Traders Watched Explode To New Highs
January 03, 2021 at 18:34 PM EST
Did You Miss These Penny Stock Picks?
There’s no doubt that 2020 was one of the craziest years we’ve ever seen in stock market history and penny stocks were among the top performers. In recent years, we haven’t seen stocks give back 3 years of gains then rebound to new all-time highs. It was this massive drop during the late-first and early second quarters that created some of the biggest stock market opportunities we’ve seen.
The best part is that many of the stock market monsters we’ve seen this year were actually penny stocks to buy early on. Now, whether you’re calling them “stock picks” or “success stories” the end result is the same. These names on this list of penny stocks were trading below $5 for at least a short period of time in 2020.Penny Stocks Soared In 2020
Many of them ended up leaving that level far behind and one has remained a stand-out. A few things we should address first involve risk. These low-priced names carry much higher levels of risks. This is not only due to the potential for manipulation but also due to lower levels of liquidity and smaller market capitalization. In many cases, this is where we see penny stocks “do what they do,” make big moves quickly.
Now, this isn’t to say that all penny stocks are just good for day trading. It also isn’t to show that all penny stocks are worth investing in. However, in this list, you’ll get a bit of insight into some of the top performers of 2020, a brief synopsis of the companies, as well as some idea of market trends that could help this year.
The key thing to remember is that emotions shouldn’t play a role in your trading strategy. With millions of new traders last year, we certainly saw a lot of traders “falling in love” with stocks instead of trading the trend. Call them bag-holders or noobs but whatever the case, valuable lessons were learned. It’s important to keep this in mind especially when you’re talking about stocks under $5. For better or worse, many of these companies may fail but capitalizing on short-term momentum is what might matter the most.Top Penny Stocks In 2020
This having been said, let’s dive into this list of top penny stocks that hit it big in 2020…
March saw many stocks selling off thanks to uncertainty around the coronavirus. CleanSpark wasn’t immune. Shares of the penny stock reached lows of $0.97 and traded around that level for several weeks. It was during the early weeks of April that CLSK stock first came up on our watch lists. At the time, CleanSpark had just announced that its subsidiary, p2klabs, engaged AlertNest to help design a mobile app to keep people informed about local updates on coronavirus. The company also announced a joint venture with members of its multinational supply and distribution channel partners to secure medical supplies.
Fast-forward to year-end and we see that this penny stock under $1 managed to rally to highs of $30.75. This 3,070% move started with COVID news and has since transformed into a cryptocurrency story. Obviously, the diversity of tech and applications allows companies to be more nimble and address multiple market trends. Much of the recent excitement has stemmed from the company’s Bitcoin mining operations. Of course, with the surge in prices of cryptocurrencies like Bitcoin, industry sentiment remains high especially for crypto stocks. Whether or not CLSK continues on this trajectory is to be seen. But the fact is, it was trading under $1 per share less than 1 year ago.Top Penny Stocks In 2020 #4: Tupperware Brands Corporation (NYSE:TUP)
It’s interesting to see how the pandemic shifted the thinking of investors and companies alike. While many stumbled and still haven’t recovered, others have flourished. Tupperware Brands is among the list of top penny stocks from 2020 thanks to a few key milestones that its leadership turned into springboards for the road ahead. This was a penny stock that we saw reach 52-week lows in real-time in mid-March. But after hitting those $1.15 lows, TUP stock began mounting a slow recovery that ended up snowballing into something much bigger. The initial focus was on the company’s C-suite shakeup. This included a new CEO among other positions & board seats.
Then in April, the company announced an organization redesign that targets long-term sales and profitability. As they say, “The rest is history.” Shares of TUP stock ended up surging to highs of $38.18 during the 4th quarter. This came after Tupperware completed the refinancing of its Senior Notes maturing in June 2021. While the former penny stock pulled back in recent weeks, it still has maintained trading levels above its major moving averages heading into the New Year. Will this trend continue in 2021?Top Penny Stocks In 2020 #3: Kirkland’s Inc. (NASDAQ:KIRK)
Kirkland’s was discussed very early this year. At the time, shares were trading around $1.30, and eventually, KIRK stock would hit lows of $0.56 in March. If you’re into home decor, you’ve likely been past a Kirkland’s store or seen its ads online. With the “real world” essentially shutting down, brick and mortar businesses were some of the hardest hit this year. However, for Kirkland’s, its quick shift and a focus on offers and promotions on its eCommerce business has helped it thrive in a big way this year. The company also took up an early “lean” approach to help save some money. The company’s Board of Directors even elected to forego their cash compensation for the first quarter.
Jump ahead to the last quarter of 2020 and KIRK is night and day different from where it was earlier last year. In fact, in its most recent financial statement, the company explained out store and eComm sales exceeded expectations. That also translated to crushing estimates during its third quarter results. In light of this and its new share repurchase authorization of $20 million, should KIRK stock remain one to watch even if it’s no longer a penny stock in 2021?
Probably one of the more famous penny stock success stories recently is Blink Charging. It has even surpassed the percentage increase that Nio saw from earlier in the year. The March sell-off took BLNK stock down to lows of $1.25. While it wasn’t as actively traded as it was now, penny stock day traders kept this on their active lists of penny stocks to watch. Before the “EV hype” took hold, the unique model that Blink took up was the center of speculation for the market. We first began following Blink in February as the company had just announced several new board appointments. Furthermore, Tesla had begun catching some attention that helped give some “pick and shovel” EV stocks a bump.
Jump ahead to Q4 of 2020 and BLNK stock has soared. At the end of December, shares reached highs of $56.12, up 4,390% since those prior lows in March. The company has also managed to ink several more deals in recent weeks. This includes one with The Lion Electric Company, which will offer Blink’s full line of charging stations to the school systems and bus fleets that utilize the company’s all-electric school buses. While the big concern of “valuation” has come into play for many of these high-flying, EV-related names, the move that this former penny stock saw last year is definitely one to make note of. I think the biggest question now is that after such a parabolic move, can Blink really sustain these trading levels in the New Year?Top Penny Stocks In 2020 #1: Novavax Inc. (NASDAQ:NVAX)
When we first began discussing this former penny stock in mid-January, NVAX stock was trading around $4.40, up from $3.65 just a few weeks earlier. The company had reported that the FDA granted Fast Track Designation for its seasonal flu vaccine candidate. This was also just as “the Wuhan virus” started becoming the “novel coronavirus”. As more data emerged, Novavax made a push for a vaccine candidate.
After announcing receipt of up to $388 million in funding from CEPI for COVID vaccine development, NVAX stock gapped up into a whole new price level. At the time the $388 million was the largest amount the Coalition for Epidemic Preparedness Innovations had invested, too. The company also won an award for $1.6 billion to further the advancement of its coronavirus pipeline.
These helped boost NVAX stock to highs of $189.40, up 5,089% from its January lows. While it has since pulled back considerably from those highs, NVAX still trades over 2,950% higher than where it was during the first month of 2020. The company recently began PREVENT-19, its pivotal Phase 3 study in the United States and Mexico to evaluate the efficacy, safety, and immunogenicity of NVX-CoV2373, the company’s COVID-19 vaccine candidate. The company is also conducting a large pivotal Phase 3 clinical study in the U.K., a Phase 2b safety and efficacy study in South Africa, and an ongoing Phase1/2 trial in the U.S. and Australia. Data from these trials are expected as soon as the early first quarter of this year depending on transmission rates in the regions.
New To Trading Penny Stocks?
If you’re new to trading penny stocks there are a few things that might help get you started on the path of education.
There’s plenty of things you can do to learn how to trade penny stocks effectively, efficiently, and become consistently profitable too. Take your time and even try trading with a simulator first in order to hone your skills before using real money.