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5 Household Name Penny Stocks To Buy Under $5

Penny stocks that are household names. Are they on your 2022 watch list?
The post 5 Household Name Penny Stocks To Buy Under $5 appeared first on Penny Stocks to Buy, Picks, News and Information | PennyStocks.com.

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Famed investor Warren Buffett has a lot of popular quotes for average investors to make money in the stock market. One of the most prominent is to invest in what you know. In many cases, the general approach has justified the Oracle of Omaha’s investment thesis into companies like Coca-Cola and McDonald’s. But does this same idea apply to penny stocks?

Whether it’s worth it for you to buy penny stocks comes secondary to if you can find household names trading for pennies. Believe it or not, the sell-off in the stock market this year brought plenty of company shares back below the $5 level. Is it time to buy on this dip, or will new lows continue? Let’s look at some of the household names trading for pennies on the dollar right now.

Penny Stocks To Buy For Under $5

Party City Holdco Inc. (NYSE: PRTY)

Anyone with children, those who celebrate significant holidays, or even people who like to buy costumes for whatever reason have probably heard about Party City. The company was founded in the 1980s and has been one of the cornerstones of Americana, especially around Halloween.

But there haven’t been many celebrations in the stock market this year. PRTY stock is back in penny stock territory thanks to the latest stock market sell-off. It hasn’t traded this low since Q4 of 2020. Reopening last year was a big boon to the company as shoppers came back to physical retail. This was great during the first half of 2021, as optimism helped drive retail stocks. Missed earnings and the resurgence of new virus strains put pressure on the sector. Fast-forward to this month, and PRTY stock has traded below $4.85 as the market pulls back.

What is there to watch with Party City in the immediate future? Earnings will be next on the list, and preliminary Q4 revenues have been released. The company affirmed its guidance in a range of $685 million to $700 million and an adjusted EBITDA in a range of $100 million to $110 million. Party City also expects its brand comp sales percentage to jump in the high teens versus the same quarter in the prior year.

ContextLogic Inc. (NASDAQ: WISH)

most active penny stocks ContextLogic WISH stock

You may not know “ContextLogic” as a household name, but if you surf the web, you’ve likely come across an advertisement for its retail platform, Wish. Speculation ran wild last year as some saw the Wish platform as a viable competitor to some of the largest eCommerce giants in the industry.

Concern over China-based stocks, in addition to some uncertainty surrounding the core growth directive, brought doubt. As a result, WISH stock has plummeted from highs of $32.85 shortly after the official IPO to lows this week of $2.41. Companies like Google have also had issues with the international eCommerce company. Last quarter, Google pulled the plug on Wish due to product safety issues. However, as social sentiment remains high, WISH stock continues as a top meme name among retail traders.

SmileDirectClub Inc. (NASDAQ: SDC)

penny stocks to watch SmileDirectClub (SDC)

The teledentistry company, SmileDirectClub has followed a similar trend to ContextLogic. Following a brief gleam of bullishness from its IPO, shares have failed to trade higher. In fact, this week, SDC stock reached fresh record lows. Despite its market performance, things like invisible braces remain popular. With the addition of things like teeth whitening coming into the mix, SmileDirect seems to offer a solution for “new year, new me” shoppers.

One of the most significant contributing factors to the popular company has been sales performance. SmileDirectClub has failed to meet expectations quarter over quarter. Last quarter the company reported much lower expectations for the end of the year than estimates.

“We are disappointed with our third-quarter results driven by the macroeconomic headwinds that are influencing the spending of our core demographic…While we could not have anticipated the rapidly evolving nature of this impact on our consumer, we have responded quickly to focus our marketing on helping support them during this time, while we also move upstream with higher income demographics through the Challenger Campaign and investments in our Dental Partner Network.”

With another round of earnings on the way, this household name is likely one that will be watched closely for any sign of a turnaround story in 2022.

Clear Channel Outdoor Holdings Inc. (NYSE: CCO)

household penny stocks to buy Clear Channel Outdoor CCO stock

If you drive on most major highways, you’re probably familiar with Clear Channel Outdoor in some form. The company’s model focuses on outdoor advertising using billboards, bus stops, and wallscapes.

Unlike the others on this list, Clear Channel has made a solid move since the depths of the 2020 pandemic. CCO stock rose from under $0.50 in 2020 to as high as $3.70 last year. The resurgence of retail and other public gatherings breathed life back in the advertising industry. Clear Channel was a clear beneficiary.

CCO stock has weathered the storm better than many other companies despite the recent market sell-off. With a new CEO in place, Scott Wells wants to “accelerate momentum and new growth” Clear Channel aims to pursue. Furthermore, earnings are coming on February 24th, which should give some deeper insight into just how well Clear Channel Outdoor could turn things around in 2021 vs. 2020.

Express Inc. (NYSE: EXPR)

household penny stocks to buy Express EXPR stock

Clothing and accessory retailer Express Inc. is also on this list of penny stocks. It had a brief stint as one of the 2021 meme stocks to watch. Then the market reset, and investors focused specifically on the growth and recovery plans of the company as economies reopened.

Express ultimately saw a robust first half of the year last year. But since then, EXPR stock’s performance has been less than stellar. Like Party City and others on this list, Express has fallen short of expectations into the new year. For instance, third-quarter results showed the company missed sales estimates even after beating on EPS by a wide margin. Same-store sales also surged during the quarter. Tim Baxter, Chief Executive Officer, explained in a December update, “Our results provide tangible evidence that the versatility, quality, and value of our product is resonating with consumers. I am confident that we will continue to deliver positive comparable sales and gross margin expansion versus 2019 in the fourth quarter.”

Indeed, the next round of Q4 and full-year financials will give the market a better idea of what to expect in early 2022.

Penny Stocks & Household Names

Investing in what you know isn’t the end-all for making money in the stock market. It’s also essential to understand specific trends that are in place that could impact certain stocks. In the case of these household penny stocks, there are many other instances to factor into an investment thesis. The biggest question is will they be able to recover in 2022 or not? With earnings season in full swing, guidance could be something to pay close attention to if any of these are on your list right now.

The post 5 Household Name Penny Stocks To Buy Under $5 appeared first on Penny Stocks to Buy, Picks, News and Information | PennyStocks.com.

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Spread & Containment

Ontario election gives voters the chance to choose people over profits in long-term care

Ontario voters can bring about change by prioritizing people over profits and casting our ballots for those committed to transforming long-term care into…

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Flowers sit on a bench in front of a for-profit long-term care home in Pickering, Ont., where dozen of seniors died of COVID-19, in April 2020. THE CANADIAN PRESS/Frank Gunn

In the wake of the COVID-19 pandemic, there’s a once-in-a-generation opportunity to correct how public funds will be allocated for long-term care in Ontario. The choice is between more profits for shareholders or reinvestment in care for seniors and improved working conditions for employees.

Ownership in Ontario’s publicly funded long-term care is currently split between two types of providers.

First, there are for-profit facilities, owned largely by real estate companies that hold and/or manage licences to provide care. My research has found that currently, 60.1 per cent of the beds are owned or managed by for-profits. This group is a mixture of public corporate chains, real estate investment trusts and private equity firms. Six in 10 people who live in long-term care in this province do so under a profit-taking model.

The second group are care homes that happen to own real estate and reinvest surplus back into the home. Nearly four of 10 bed licences (39.9 per cent) are owned by this group. The latter are typically called not-for-profit, although they may also be publicly owned.

Even before the pandemic, for-profit facilities were associated with significantly higher rates of mortality and hospital admission, suggesting there’s significantly worse quality of care overall in for-profit than in non-profit and public homes.

In addition, the devastation in long-term care during the height of the pandemic’s first and second waves happened mostly in for-profits, where a higher proportion of residents died. There was a 25 per cent higher risk of death from COVID-19 in for-profit facilities.

A row of white crosses on a green lawn. A small Canadian flag is attached to one of the crosses.
Crosses are displayed in memory of elderly people who died from COVID-19 at a for-profit long-term care facility in Mississauga, Ont., in November 2020. THE CANADIAN PRESS/Nathan Denette

Renegotiating licences

The Ontario government is currently approving licences with operators for up to 30 years. About one-third of the existing bed licences (26,531 beds) in 257 long-term care homes will expire by June 30, 2025. These licenses are in various stages of being renegotiated for the next 30 years.

The current government also announced there will be 30,000 new beds and 28,000 upgraded beds in place by 2028, also at various stages of approval. With the renewals, renovations and construction, what happens to long-term care licences in the next calendar year will shape the course of long-term care for the next 30 years.

A vote in this election therefore represents a choice between more for-profits or a move towards non-profit long-term care.


Read more: Canadians want home care, not long-term care facilities, after COVID-19


Long-term care licences can be very lucrative. Each new bed built is eligible for a construction funding subsidy, known as a CFS, calculated per day. The CFS ranges from $20.53 to $23.78 per day depending on where the home is located; large urban settings have higher subsidies. This is in addition to the funding an operator receives from government to provide care and food.

If a home has 160 beds, an additional 75 cents per bed per day is added to the subsidy. In the most expensive urban market with 160 beds (five units of 32 people), tax dollars will fund that organization $3,924.80 per day in capital costs to a maximum of $51,376 per bed — or a subsidy for the building of $8,220,160.

These subsidies are meant to cover between 10 to 17 per cent of capital costs. Rural beds are capped at a maximum subsidy of $29,246 per bed annually, while large urban centres cap at $51,376 per bed.

There are no upper limits on bed numbers, so it’s difficult to calculate the maximum subsidy. There are few homes in the province exceeding 160 beds, but that could change. The public doesn’t have a stake in the ownership of a home due to the subsidies.

Accommodation fees

Facilities also collect and retain rental accommodation fees from residents. For semi-private, shared nursing home rooms, a resident will pay $2,280.61 monthly at current rates, and for a private room, residents are charged up to $2,701.61 per month. Those living in for-profit retirement homes, many of whom are on waiting lists for a long-term care bed, are not included in this model.

If 60 per cent of the rooms are private and not shared, and assuming current accommodation rates, my calculations show the home will collect and retain $116,719,810 in accommodation fees over the 30-year licence, or nearly $4 million per year.

These funds collected for accommodation rental are completely separate from the funds publicly paid to support care, currently set at $187.73 per day for a home operating at 100 per cent based on the complexity of the needs of its residents.

If the current government or any successive government replicates past decisions, more than 65,000 Ontarians a year will live in a for-profit facility — many run by corporations focused on their real estate investments — in the next decade. If we follow a different path, these subsidies could fund operators that are primarily care organizations and where real estate holdings support the care, not the other way around.

A man pushes his walker as he strolls outside a long-term care home.
A man takes a walk outside the not-for-profit Seven Oaks Long-Term Care Home in Toronto in June 2020. THE CANADIAN PRESS/Frank Gunn

No one should assume they or their loved ones won’t need long-term care. All modern and caring societies have long-term care. The difference is that in countries like Norway, the focus is on high-quality, publicly delivered care, not on favouring for-profit real estate models.

Certainly not everyone will need long-term care. Not everyone needs open-heart surgery. But we do need high-quality public health care so that no one has to contemplate losing their life savings to survive. Those who need long-term care are among society’s most vulnerable members, and they deserve the very best quality of care and for every dollar to be invested in ensuring their care is top-notch.

No further study of this issue is required. Those living in for-profit facilities fare worse than those in non-profits and public homes.

In Ontario, we can prioritize people over profits by casting our ballots for those committed to transforming long-term care into a non-profit model focused on high-quality care. Know which party supports non-profit, long-term care and vote accordingly.

Tamara Daly receives funding from the Canadian Institutes of Health Research and Social Sciences and Humanities Research Council

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Economics

Hotels: Occupancy Rate Down 3.5% Compared to Same Week in 2019

From CoStar: STR: Weekly US Hotel Revenue per Available Room Reaches Highest Level Since July 2019U.S. hotel performance increased from the previous week, according to STR‘s latest data through May 21.May 15-21, 2022 (percentage change from comparable …

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U.S. hotel performance increased from the previous week, according to STR‘s latest data through May 21.

May 15-21, 2022 (percentage change from comparable week in 2019*):

Occupancy: 68.6% (-3.5%)
• Average daily rate (ADR): $151.75 (+13.4%)
• Revenue per available room (RevPAR): $104.06 (+9.5%)

*Due to the pandemic impact, STR is measuring recovery against comparable time periods from 2019.
emphasis added
The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.

Click on graph for larger image.

The red line is for 2022, black is 2020, blue is the median, and dashed light blue is for 2021.  Dashed purple is 2019 (STR is comparing to a strong year for hotels).

The 4-week average of the occupancy rate above the median rate for the previous 20 years (Blue).

Note: Y-axis doesn't start at zero to better show the seasonal change.

The 4-week average of the occupancy rate will mostly move sideways seasonally until the summer travel season.

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Economics

“This Is A Crucible Moment” – Sequoia’s Ominous Warning To Companies On How To “Avoid The Death Spiral”

"This Is A Crucible Moment" – Sequoia’s Ominous Warning To Companies On How To "Avoid The Death Spiral"

"This is not a time to panic. It is…

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"This Is A Crucible Moment" - Sequoia's Ominous Warning To Companies On How To "Avoid The Death Spiral"

"This is not a time to panic. It is a time to pause and reassess," begins the thought-provoking presentation from veteran venture capital firm Sequoia Capital.

But that's about as 'positive' as they get as the founders of the firm warn of a prolonged market downturn and urges the startups in its portfolio to preserve cash and brace for worse to come.

"We believe this is a Crucible Moment, one that will present challenges and opportunities for many of you. First and foremost, we must recognize the changing environment and shift our mindset to respond with intention rather than regret."

And in its somewhat ubiquitous historically grim outlooks (its "R.I.P Good Times" in 2008 and "Black Swan" memo in March 2020 have become legendary) don't expect a quick rescue and recovery this time.

"Sustained inflation, and geopolitical conflicts further limit the ability for a quick-fix policy solution. As such, we do not believe that this is going to be another steep correction followed by an equally swift V-shaped recovery, like we saw at the outset of the pandemic," the note said.

They argue that it will be "Survival of the Quickest"...

In particular, Sequoia urged companies to look at cutting projects, R&D, marketing, and other expenses, noting that companies should be ready to cut in the next 30 days.

"We expect the market downturn to impact consumer behaviour, labour markets, supply chains and more. It will be a longer recovery and while we can't predict how long, we can advise you on ways to prepare and get through to the other side," it said.

The founders/CEOs who face reality, adapt fast, have discipline rather than regret will not just survive, but win, noting that "It is easier to preserve cash when you have more than six months left. Recruiting is about to get easier. All the FANG have hiring freezes."

They conclude their presenttation by noting that:

"At Sequoia, we believe that the one who wins is the one most prepared."

In other words America, brace for capex cuts, hiring freezes to accelerate, and growth to evaporate.

*  *  *

Read the full presentation below:

Tyler Durden Thu, 05/26/2022 - 15:45

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