Key Points
The overall market is just 1.5% from its all-time high, up over 4% this month, leading to increased speculation in small-cap penny stocks.
Retail investors’ interest in small-cap stocks has surged following the meme mania earlier this month despite the inherent risks of volatility, low volume, and weak fundamentals.
Today, Smart for Life Inc., Momentus Inc., and Sharps Technology, Inc. saw impressive volume and price increases driven by various strategic announcements and positive developments.
5 stocks we like better than Smart for Life
As the overall market trades just 1.5% away from its all-time high and up over 4% on the month, there has been a noticeable increase in risk appetite and speculation in small-cap penny stocks by retail investors. This surge in interest follows the meme mania experienced earlier in the month. However, trading or investing in small-cap stocks has increased risks due to heightened volatility, small floats, low average volumes, and typically weak fundamentals.
Here are three penny stocks that have seen impressive abnormal volume and price surges today:Get Smart for Life alerts:Sign Up
Smart for Life Inc.
$3.45 -2.52 (-42.21%) (As of 05/31/2024 ET)52-Week Range$2.27▼$90.71
Smart for Life NASDAQ: SMFL acquires, develops, manufactures, operates, markets, and sells nutraceutical and related products in the United States and internationally.
Today, the stock experienced a dramatic surge, trading 25 million shares compared to its average daily volume of just 800k. This increased trading activity propelled the stock price upwards by over 50%. The catalyst for this movement was the company’s announcement of completing a comprehensive restructuring plan. The plan included several strategic changes such as recapitalization, selling non-performing assets, selling and leasing back its Doral manufacturing facility, selling 51% of Ceautamed Worldwide, and liquidating its senior debt facility with Diamond Creek Capital.
Despite the positive news, Smart for Life is still down 50% year-to-date and has a history of closing weak after volume surges. The stock’s volatility is amplified by its micro float of under 500k shares, maintaining an overall downtrend on a higher timeframe.
Momentus Inc.
$0.84 -0.03 (-3.45%) (As of 05/31/2024 ET)52-Week Range$0.35▼$23.48
Momentus NASDAQ: MNTS and its subsidiaries operate as a commercial space company, providing in-space transportation services.The stock saw a significant increase in trading volume, with over 40 million shares traded today, far exceeding its average daily volume of 178k. This surge resulted in the stock price rising by over 11%. The driving force behind this increase was the announcement that Momentus secured a contract from the Defense Advanced Research Projects Agency (DARPA). This contract aims to support the design and in-space demonstration of technologies that will enable the construction of large-scale structures in space.
However, it’s important to note that the stock has been in a significant downtrend, down over 60% year-to-date and nearly 90% on the year. The stock’s small float of just 16 million shares contributes to its price volatility, making it a high-risk investment.
Sharps Technology, Inc.
STSSSharps Technology$0.38 -0.10 (-20.75%) (As of 05/31/2024 ET)52-Week Range$0.17▼$1.05
Sharps Technology NASDAQ: STSS is a medical device company that researches, designs, develops, manufactures, distributes, and sells safety syringe products.
The stock broke its major downtrend this week and experienced a notable surge in volume, trading over 90 million shares today, compared to its average volume of 17 million shares. This activity pushed the stock up by almost 20% today and over 100% on the week. The recent surge was driven by the company’s announcement of a 5-year, $200 million syringe sales agreement and an amendment to an asset purchase agreement to begin producing pre-fillable specialty copolymer syringes in the U.S.
The Bottom Line
The broader market’s momentum and impressive staying power, as well as the resurgence of risk appetite among retail investors, have led to significant interest in small-cap penny stocks. However, while many of these stocks have shown impressive volume and price surges, they come with substantial risks. It’s crucial for investors to exercise caution and consider the potential for high volatility and the likelihood of share dilution when investing in these stocks. Being informed, conducting thorough due diligence, and being prepared is key to navigating penny stocks’ unpredictable and uncertain world.Before you consider Smart for Life, you’ll want to hear this.MarketBeat keeps track of Wall Street’s top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on… and Smart for Life wasn’t on the list.While Smart for Life currently has a “hold” rating among analysts, top-rated analysts believe these five stocks are better buys.View The Five Stocks Here Wondering where to start (or end) with AI stocks? These 10 simple stocks can help investors build long-term wealth as artificial intelligence continues to grow into the future.Get This Free Report
