As we head toward the end of January, penny stocks continue to ride the bullish wave. There has been an incredible amount of momentum building up in these cheap names in the past six months. One of the most interesting and undiscussed factors in play right now is the infusion of retail investors. Given that trading platforms like Robinhood are making investing easier than ever, there is a large amount of new capital in the stock market.
With this, investors are always searching for the best and most potentially valuable penny stocks to buy. With so many new traders, volatility seems to be at an all-time high. This is not true across the board, but it is something to keep in mind. We’ve also seen a boost of interest in certain areas of the market. Electric vehicles are one of these areas. So with a full year ahead of us, there are a few things that investors should know before picking certain EV penny stocks for their watch list.
First, industries such as electric vehicles and alternative energy have experienced increased interest following Biden’s election. Whether or not these areas will continue to grow remains to be seen. Second, many investors believe that there could be a rebirth in economic growth with vaccines being distributed.
With the election of Joe Biden, many investors are counting on the expansion of the EV sector. One of his campaign’s focuses was on bringing the country toward a renewable energy future, away from fossil fuels. With this, there could be many subsidies for EV manufacturers and write-offs for those looking to buy. Obviously, a lot of this is purely speculation, and investors should take it with a grain of salt. But, overall, the bullish sentiment in the stock market is more than tangible right now. With this in mind, let’s take a look at some EV-related penny stocks to watch after the long weekend.EV Penny Stocks to Watch
- United States Antimony Corp. (NYSE: UAMY)
- Polymet Mining Corp. (NYSE: PLM)
- Medigus ADR (NASDAQ: MDGS)
This is a penny stock that we have covered several times in the past month or so. In the last thirty days, shares of UAMY have shot up by around 63%. Since September, shares are up by almost 200%. The uptick underlines this rise in interest for companies with potential exposure to the EV space. The company works as a producer and seller of various ores. This includes antimony, silver, gold, and zeolite. Its products are used in various applications, including cathode ray tubes all the way to the all-important storage batteries. While its operations span many industries, its relation to EV battery materials remains very important right now.
A few weeks ago, the company announced that it had completed its initial test program at the Los Juarez gold, silver, and antimony mine. After completing a private placement back in July, the company received the capital needed to begin researching the various components of this mine. Initial samples show a very high degree of target materials, which could be beneficial once mining commences. As a mining penny stock, United States Antimony Corp. has gained some attention from those looking for EV and rare-earth stocks. Whether or not that makes UAMY a penny stock to watch this week remains to be seen.Polymet Mining Corp.
Another mining company with exposure to the EV sector is PolyMet Mining Corp. The company operates in the exploration and development of various mines around the U.S. and Canada. This includes mines that produce copper, nickel, cobalt, platinum, palladium, and gold. While the company has been supplying steel for over one hundred years, it has recently moved heavily into the copper industry. This is due to the recent advancements in copper mining playing out at its Duluth Complex mine. This complex is simply one part of the much larger NorthMet ore body that the company owns in Minnesota. Currently, the company is waiting on several approvals from the local government.
This includes approvals from the Minnesota Pollution Control Agency and the Minnesota Center for Environmental Advocacy, to name a few. A few months ago, the company stated that its water quality permit regarding the mine should exceed expectations. Although it received a letter challenging the water permit, CEO of Polymet, Jon Cherry, stated that “we are pleased with the district court’s ruling and look forward to defending the challenge to the water permit currently pending in the court of appeals.”
While this may take some time to solve, in the meantime, Polymet is still working to provide a high quantity of mined ores. Aside from its EV exposure, the price of things like platinum and palladium are also moving and could be something to keep track of if PLM is on your list of penny stocks to watch.Medigus ADR
Medigus is another one of the companies that we’ve discussed for a few months. In the past thirty days, shares of MDGS stock are up by over 35%, and since October, by around 80%. While the company has a history as a medical device provider, the more recent focus is on the EV market. In particular, the company has several agreements currently standing. This includes an MOU with EMuze, which would offer Medigus a 19.99% stake in a venture to produce EV-micro mobility vehicles.
This year the company expanded its EV operations even further. Medigus entered into a purchase agreement for the IP and know-how, including a provisional patent for a robotic charging pad for wireless charging of electric vehicles. Medigus also plans to consolidate its electric vehicle and wireless charging activities under a new subsidiary that it intends to form.
With this sector continuing to heat up, MDGS has become one of the electric vehicle penny stocks to watch. However, given its volatile history, it’s important to understand that prices have swung violently in prior weeks. Will this remain one of the names to follow with the current sentiment in EV?Final Thoughts On Electric Vehicle Penny Stocks
Although it’s been around for years in some form or another, this is a very new industry. With the incoming president, it could remain a hot topic. However, like all industries with a lot of hype, volatility can play a big role, and speculation may drive momentum more than fundamentals. For example, though it isn’t a penny stock, Churchill Capital Corp IV (NYSE: CCIV) has become a focus for traders this month. Conversations have surfaced that suggest the SPAC is looking into a target company, Lucid Motors. The EV company has been compared to Tesla and other top electric vehicle makers.
Lucid recently launched its own luxury EV, which has been the center of attention for many traders. Last year, confusion on just the name of a public company caused traders to buy shares of the wrong stock, thinking Lucid Motors was public via a dark and defunct penny stock. Needless to say, while many of these companies have made strides toward expansion, it’s important to keep in mind that valuation multiples are at all-time highs. But with sentiment still bullish, EV could be one of the top sectors to follow in 2021.