Shares that commerce below $5 per share are also known as penny shares. Many penny shares commerce for literal pennies (or much less) on the OTC market, however there are many penny shares that commerce on main exchanges as effectively.
The Nasdaq and NYSE require all shares listed on their exchanges to take care of a minimal share price of $1 or threat being delisted. Most firms don’t want their shares buying and selling below $5, so there’s an excellent probability the big majority of penny shares have been by means of some powerful instances. However that doesn’t imply there are not any penny stock shopping for alternatives as effectively.
Listed here are eight penny shares to purchase, maintain and promote, based on Bank of America.
Lloyds Banking Group PLC (NYSE: LYG) – Promote
Lloyds Banking Group has a market cap of greater than $100 billion and is likely one of the largest banks within the UK, however you wouldn’t comprehend it by its $1.50 stock price. Lloyds shares are down one other 53% prior to now yr because the bank struggles to cope with traditionally low rates of interest.
Analyst Rohith Chandra-Rajan not too long ago mentioned Lloyds’ first quarter numbers had been unhealthy throughout the board, however given earnings and credit score high quality pressures, issues may get even worse within the second quarter. For now, Lloyds has satisfactory capital, however the firm’s income outlook must considerably enhance earlier than the stock is investable, Chandra-Rajan mentioned.
Bank of America has an Underperform ranking and $1.28 price goal for LYG stock.
See Additionally: 11 Causes Billionaire Investor Leon Cooperman Is Frightened About Lengthy-Time period Impacts Of COVID-19
Nokia Oyj (NYSE: NOK) – Purchase
Nokia is a telecom community infrastructure tools provider. The stock is down 29.3% prior to now yr, however analyst Tal Liani not too long ago mentioned the corporate’s first-quarter numbers had been stable.
Wanting forward, Liani mentioned 5G demand ought to ramp up within the second half of the yr, and Nokia has important alternatives to enhance its margins and switch round its slumping enterprise. Within the first quarter, Networks gross margins had been up 3.5% from a yr in the past to above 30%. Liani mentioned Nokia is much from a progress story given gross sales will possible be down 3.4% in 2020, however the stock has self-help upside potential.
Bank of America has a Purchase ranking and $4.80 price goal for NOK stock.
Ford Motor Firm (NYSE: F) – Purchase
Ford shares have spent a lot of the final six weeks buying and selling proper round $5. The worldwide auto business has been decimated by the coronavirus outbreak.
Ford reported a $2 billion first-quarter loss and guided for an additional $5 billion loss within the second quarter. Nonetheless, analyst John Murphy mentioned Ford has achieved an excellent job in shoring up its stability sheet by drawing $15.Four billion on its revolving credit score facility and elevating $eight billion through an unsecured senior notes providing. Murphy mentioned Ford will possible emerge from the financial downturn a stronger firm, and the financial pressures have possible hastened Ford’s restructuring and cost-cutting efforts.
Bank of America has a Purchase ranking and $7 price goal for F stock.
Nio Inc – ADR (NYSE: NIO) – Purchase
After a brutal 2019, shares of Chinese language electrical car maker Nio have gained 81.6% thus far in 2020 however stay priced below $4. Analyst Ming Hsun Lee not too long ago upgraded Nio.
Within the midst of a brutal world auto market, Nio reported 3,155 deliveries in April, up 181% from a yr in the past and 106% from March. Lee mentioned Nios current fundraising has lowered cash burn fears and gross sales progress ought to assist increase margins over time. Lee additionally mentioned the not too long ago introduced EV buy subsidy scheme demonstrates that the Chinese language authorities intends to assist assist the corporate.
Bank of America has a Purchase ranking and $5 price goal for Nio stock.
Southwestern Power Firm (NYSE: SWN) – Promote
Southwestern Power is likely one of the largest pure fuel producers within the U.S. The oil market has been devastated by the financial shutdown, however pure fuel costs have really been comparatively steady year-to-date. Nonetheless, analyst Doug Leggate not too long ago mentioned core Marcellus stock depth is a priority for the corporate.
Southwestern is also susceptible to exceeding its web leverage necessities below its 2018 debt covenants. Shares are up 80% prior to now three months on the expectation that much less U.S. oil manufacturing will restrict related fuel provide, however Leggate mentioned the influence could also be smaller than buyers understand.
Bank of America has an Underperform ranking and $1.85 price goal for SWN stock.
Transocean LTD (NYSE: RIG) – Promote
Transocean is likely one of the world’s largest offshore oil drilling contractors. Transocean has been one of many worst investments out there over the previous decade, and shares are down 98% total throughout that interval. Sadly, analyst Mike Sabella not too long ago mentioned there appears to be no finish in sight for Transocean’s troubles.
Sabella mentioned there’s primarily no demand for offshore drilling, and a extreme lack of capital will possible pressure chilly stacking and scrapping of current rigs. Leverage and free cash move issues will possible proceed to plague the corporate for years to come back.
Bank of America has an Underperform ranking and $1 price goal for RIG stock.
See Additionally: 7 Finest-Performing Shares Of 2020: Purchase, Promote Or Maintain?
J C Penney Firm Inc (NYSE: JCP) – Promote
Twenty years in the past, it might have appeared inconceivable that JC Penney shares can be buying and selling at 18 cents. But right here we’re. Lower than two years after Sears was delisted, JC Penney is a real penney stock and seems to be headed down the identical path.
Even previous to the coronavirus outbreak, same-store gross sales dropped 7% within the fourth quarter and the corporate guided for as much as a 4.5% drop in 2020. Analyst Lorraine Hutchinson not too long ago mentioned JC Penney merely can’t appear to cease the bleeding, and the stock is untouchable until the corporate in some way finds a approach for its enterprise to make a 180-degree flip quick.
Bank of America has an Underperform ranking and 20-cent price goal for JCP stock.
Picture credit score: Miosotis Jade, through Wikimedia Commons
Newest Scores for F
DateFirmActionFromTo Apr 2020Goldman SachsInitiates Protection OnNeutral Mar 2020Morgan StanleyMaintainsOverweight Mar 2020CitigroupMaintainsNeutral
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