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Best Penny Stocks to Watch Tomorrow? Check These 3 Small-Caps Out

Check these penny stocks out for your watchlist tomorrow
The post Best Penny Stocks to Watch Tomorrow? Check These 3 Small-Caps Out appeared first on Penny Stocks to Buy, Picks, News and Information | PennyStocks.com.

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3 Penny Stocks to Add to Your Watchlist Tomorrow

With another day of trading penny stock almost here, investors are hopeful that the future can remain bullish. While penny stocks have been extremely volatile over the past few months, this volatility also offers investors the chance to make money with small caps. For those who use the swing trading method, there is plenty of momentum to take advantage of. Now, traders must also understand exactly what is going on in the stock market in order to take advantage. 

[Read More] 3 Penny Stocks That Investors Are Watching Right Now And Why

This means looking at the news, company and industry-specific events, and more. In addition, knowing what events are upcoming, will also be a major benefit to you and your trading. While no one expects the market to get any less volatile in the coming days, there are a variety of ways to benefit. With that in mind, let’s take a look at three penny stocks that investors are watching this week. 

3 Penny Stocks to Watch This Week 

  1. ReTo Eco-Solutions Inc. (NASDAQ: RETO
  2. Autoweb Inc. (NASDAQ: AUTO
  3. Gaotu Techedu Inc. (NYSE: GOTU

ReTo Eco-Solutions Inc. (NASDAQ: RETO) 

With a 12% gain during trading today, RETO stock is in focus for many investors. While today’s gain may seem substantial, shares of RETO stock have climbed by almost 80% in the last five days. This is a major gain and one that reflects an announcement made a few weeks ago. 

On January 4th, the company announced that its subsidiary, ReTo Technology Development Co. Ltd., entered into an equity acquisition agreement with Hainan REIT Mingde Investment Holding Co. Ltd. The agreement will see RETO gain 100% interest in REIT Mingde which owns over 60% of the equity interest in Yile IoT Technology Co. Ltd. For some context, Yile IoT is a large high-tech company based out of China whose main focus is on IoT tech. 

“We are excited about the acquisition of REIT Mingde as we believe this transaction will enable us to integrate Yile IoT’s technologies into ReTo and accelerate the upgrade and growth of ReTo’s business. With the support of IoT technologies, ReTo strives to become a technology driven provider of services for ecological and environmental protection industries, and increase value for our shareholders.”

The CEO of ReTo Eco-Solutions, Mr. Hengfang Li

This is all exciting news and reflects solid growth potential for RETO stock. With that in mind, will it earn a spot on your list of penny stocks to watch or not?

Autoweb Inc. (NASDAQ: AUTO) 

Another decent gainer of the day so far is Autoweb Inc. By EOD, shares of AUTO stock had shot up by over 11% to north of $3.50 per share. If you’re not familiar, AutoWeb Inc. provides a large range of auto-relates services to dealers and manufacturers around the country.

[Read More] 5 Hot Meme Stocks To Buy For Pennies Right Now

Since the mid-90s, AutoWeb has been helping car buyers and automakers sell, buy, and everything in between. The company states that it offers leads, clicks, marketing services, and much more. Today, the company announced that it will offer its customers a way to drive a Tesla Model 3 without having to buy or lease a car. Rather, this will involve a month-to-month time frame. 

“As more of the vehicle transaction process shifts online, our business continues to evolve toward transactional monetization opportunities. We also remain focused on growth-oriented segments of the market—from new vehicle acquisition offerings to electric vehicle adoption—to stay relevant with these shifts in consumer preferences.

Our relationship with Autonomy is at the core of these radical shifts in the industry, providing our car shopping audience with a completely digital and affordable way to get access to a Tesla Model 3.”

Jared Rowe, the CEO of AutoWeb

This is an interesting move for the company and one that should remain relevant as more consumers switch to electric. With that in mind, does AUTO stock deserve a place on your penny stocks watchlist?

Penny_Stocks_to_Watch_AutoWeb

Gaotu Techedu Inc. (NYSE: GOTU) 

With 5.9% in positive gains by EOD on January 20th, GOTU stock has climbed by over 20% in the last five days. This is a major bullish turn from its 80% loss streak over the last six months. Gaotu and other Chinese education penny stocks have had a tough time performing in the last few months. 

As the result of China cracking down on for-profit education companies, Gaotu has had to completely shift its business model. Now, the company states that in order to remain in business, it will move to live-streaming e-commerce, as well as the sale of agricultural products online. The CEO of Gaotu, You Minhong, states that he has a responsibility to the 50,000 employees that remain, and therefore, he wants to find a way to stay in business. 

Considering that, there is still a long way to go for GOTU to be even close to profitable. But, the company continues to make strides in the right direction. While it will take some time for it to get back on track, investors hope that it can moving forward. Considering this, do you think that GOTU stock is worth watching or not?

Penny_Stocks_to_Watch_Gaotu

Which Penny Stocks Are on Your Watchlist Right Now 

If you’re making a list of penny stocks to watch, there are hundreds to choose from. However, understanding exactly where to look and what to look for is a crucial step in making money with penny stocks. In the past few trading days, we’ve seen the stock market be extremely volatile. This is a side effect of the pandemic, economic uncertainty in the U.S., geopolitical problems, and other factors. 

[Read More] Trading Penny Stocks? Top Stock Market News For January 20th, 2022

But, to understand how to profit from penny stocks, investors need to have a consistent understanding of how these factors will play into the market. In addition, it will always be prudent to have a consistent and well thought out trading strategy. This will always be your best bet in taking advantage of the current state of the stock market. So, with all of this in mind, which penny stocks are on your watchlist right now?


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The post Best Penny Stocks to Watch Tomorrow? Check These 3 Small-Caps Out appeared first on Penny Stocks to Buy, Picks, News and Information | PennyStocks.com.

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Economics

Best Day For Discretionary Stocks Since COVID-Crash As Consumer Recession Bets Get Steamrolled

Best Day For Discretionary Stocks Since COVID-Crash As Consumer Recession Bets Get Steamrolled

A week ago, following dismal guidance by Walmart,…

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Best Day For Discretionary Stocks Since COVID-Crash As Consumer Recession Bets Get Steamrolled

A week ago, following dismal guidance by Walmart, Target indicated that it is seeing a shift in the consumer wallet away from the pandemic purchases and into reopening purchases - including apparel - and the pace of this shift caught some retailers off guard on inventory. WMT, COST, and TGT all saw their stocks fall sharply last week as investor concerns around a US consumer slowdown mounted and investors reconsidered just where, if anywhere, you can play "defense" in the current market.

But as Goldman's Chris Hussey writes today, this week, results from companies like DKS, Macy's, JWN, WSM, DLTR, and DG painted a decidedly different picture.

Deep discount retailers Dollar Tree - or rather Dollar 25 Tree - and Dollar General both posted strong results and DLTR raised top-line guidance.

Which isn't surprising: as we discussed in "Middle Class Is Shutting Down As Spending By The Rich Remains Robust" when consumers are trading down - as they are doing now due to Biden's runaway inflation - dollar stores see more business.

As a result, Dollar Tree surged as much as 20% on Thursday, the biggest intraday move since October 2020. Evercore ISI said Dollar Tree's move to a "$1.25 price point" last November from $1 “came in the nick of time" adding that "given the broad-based inflationary cost pressures, the 25% price increase drove material sales and margin upside for both the namesake division and the total company," wrote analyst Michael Montani who also said that while freight, transport, and labor headwinds are real, some of the pressure cited by Target last week was likely company specific.

The analyst concluded that the read-across from DG and DLTR is “favorable,” and it seems that the low-end consumer is “hanging in better than initially thought.” Or rather, the middle-class is getting crushed and it has no choice but to trade down to the cheapest retail outlets.

And with countless shorts having piled up and getting massively squeezed, the S&P 500 Consumer Discretionary Index today has risen as much as 5.6%, its best day since April 2020, as optimism on the health of the consumer returns following a string of better-than-expected earnings reports from retailers.

Top performers in the S5COND index include Dollar Tree, Dollar General, Norwegian Cruise, Caesars Entertainment and Carnival; the Discretionary Index is on pace for its best week since March 18, when the group climbed 9.3%; the index sank 7.4% as Walmart and Target reports spooked investors. The index is still down almost 30% YTD.

"Retail earnings are bullish.... with four blow-outs,” said Vital Knowledge’s Adam Crisafulli, referring to quarterly reports from Williams-Sonoma, Macy’s, Dollar General, and Dollar Tree.  “The overall retail industry is experiencing stark changes and the market is incorrectly conflating these shifts with underlying demand weakness when the actual health of the consumer is much better than it seems,” Crisafulli says, although there are many - this website included - who wholeheartedly disagree with his optimistic view of the US consumer.

Remarkably, thanks to today’s rally, even Burlington Stores, which sank as much as 12% in premarket on disappointing results, is trading up as much as 11% and some say, the rally helped reverse the earlier tumble in NVDA shares.

The discretionary group is also getting a boost from airline operators Southwest and JetBlue, helping travel-related names, while on the economic front, better-than-expected personal consumption (for the revised Q1 GDP print). and jobless claims may be adding to the bullishness according to Bloomberg.

Tyler Durden Thu, 05/26/2022 - 15:00

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Restaurants’ Share Of Food-Dollar Grows To Record 54.9% In April

Restaurants’ Share Of Food-Dollar Grows To Record 54.9% In April

By Nation’s Restaurant News

Restaurants continued to increase their share…

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Restaurants' Share Of Food-Dollar Grows To Record 54.9% In April

By Nation's Restaurant News

Restaurants continued to increase their share of spending in April, reaching 54.9% of the food dollar, according to U.S. Census data released Tuesday. That was a 260-basis-point increase from April last year, when the share was 52.3%, said analyst Mark Kalinowski, president and CEO of New Jersey-based Kalinowski Equity Research LLC.

“Even more impressively, as best as we can tell, this 54.9% market share figure for April 2022 is an all-time monthly high for the U.S. restaurant industry,” Kalinowski said in a note released Tuesday about the April U.S. Census data.

Kalinowski said restaurants, especially multi-unit public chains, were increasing prices but at a more modest rate than retail groceries.

“The key takeaway from this is you have a lot of menu prices going up in the restaurant industry,” he said in an interview.

“And, of course, the fear anytime you're raising your menu prices is that customers will trade down, but that hasn’t happened.”

Kalinowski noted that while restaurant brands were increasing prices, the rate of hikes was less than in grocery prices.

“If you need to eat — and I haven't yet met the person who didn't need to eat — you have got to buy the food from some place unless you're growing it yourself or you have a neighbor who grows it,” he said. “The fact is the restaurant industry offers a lot of convenience. It offers experiences that the grocery stores can't match.

“It is so firmly a part of the American fabric now that Americans don't necessarily want to cut their restaurant spending,” Kalinowski said.

The analyst also noted that larger restaurant brands were being very calculated in how they were raising prices to offset their increased commodity and labor costs.

For example, Kalinowski noted, “McDonald's looks at the food at home inflation and takes that into account with their menu pricing. I would imagine there's definitely a lot of other chains out there that have gotten a little more sophisticated with how they take their menu pricing.”

Those judicious price increases are easier for large, multi-unit chains to institute than for independent restaurants, he noted.

“Independents lack the scale advantages that large chains have,” he said, “so part of the challenge for independence is, in the time of just big commodity cost inflation, how do you battle that. That's not saying it's easy for the large chains — it's hard on everybody just about.”

Over the past two years, he added, the industry has seen the largest shift toward big restaurant brands who are taking increased shares of what is a larger pie.

Census data for April calculated U.S. food services and drinking places posted $83.741 billion in sales, as compared to the April 2022 figure for U.S. grocery stores of $68.906 billion.

Kalinowski said it was intriguing that combined foodservice and drinking place sales with grocery sales had increased significantly from pre-pandemic levels.

“There seems to be meaningfully more spending on food/beverages than there was pre-pandemic,” he said. “The April 2022 combined number of $152.6 billion is 26.4% larger than the April 2019 combined number of $120.7 billion.”

This past April marked the 12th consecutive month for which that number was up more than 10% over the corresponding pre-pandemic monthly number, Kalinowski noted.

“We continue to look for restaurants’ market share in full-year 2022 to be at least one full percentage point higher than the full-year 2021 figure of [positive] 52.7%,” he said.

“All in all, this is good news for restaurant stocks — which tend to be comprised of the very largest restaurant concepts in most cases,” Kalinowski said in his note. “Large concepts have fared better than smaller chains and independents during the pandemic, creating the largest opportunity in decades for market-share gains within the restaurant industry favoring large chains.”

Tyler Durden Thu, 05/26/2022 - 13:40

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Economics

‘Insiders’ Are Buying This Dip

‘Insiders’ Are Buying This Dip

The Nasdaq is in the middle of its worst drawdown since the Lehman crisis and the Dow just suffered its longest…

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'Insiders' Are Buying This Dip

The Nasdaq is in the middle of its worst drawdown since the Lehman crisis and the Dow just suffered its longest losing streak in 99 years.

As that is happening, faith in The Fed is crumbling as Powell faces the central bankers' nemesis of stagflation... and all in an election year (threatening the confidence in The Fed's independence should it falter from its path of uber-hawkishness).

According to the latest BofA Fund Manager Survey, the grim 'market' has sent investors reeling with those equity funds tracked by EPFR Global suffering six straight weeks of outflows (the longest stretch of withdrawals since 2019), and cash levels among investors soaring to their highest level since September 2001.

Additionally, the BofA survey also showed that technology stocks are in the 'biggest short' since 2006.

The 'proverbial' dip-buyer appears to have abandoned hope as the strike on any Fed Put (at which Powell will fold like a cheap lawn chair over the pain) gets marked lower and lower.

But...

There is one group apparently, that is willing to dip a toe in the capital market deadpool - corporate insiders.

As Bloomberg reports, according to data compiled by the Washington Service, more than 1,100 corporate executives and officers have snapped up shares of their own firms in May, poised to exceed the number of sellers for the first month since March 2020 marked the pandemic trough two years ago.

The ratio has surged to 1.04 this month from 0.43 in April.

Notably, the insider buy-sell ratio also jumped in August 2015 and late 2018, with the former preceding a market bottom and the latter coinciding with one.

“It is a function of investors functioning at the '30,000 foot level' or 'macro' whereas insiders are functioning at the 'boots on the ground', company-fundamentals level,” said Craig Callahan, chief executive officer at Icon Advisers Inc. and author of 'Unloved Bull Markets'.

“We believe the company-fundamentals view is usually correct.”

Nicholas Colas, co-founder of DataTrek Research, is not as confident:

“All we know for sure is that the valuation of any stock or the entire market hinges on whether investor confidence in future cash flows is rising or falling. At present, confidence is falling,” he wrote in a recent note.

“This is not because stocks expect a recession. Rather, it is because the range of possible S&P 500 earnings power runs in a wide channel and can become wider still.”

Starbucks' Interim Chief Executive Officer Howard Schultz and Intel CEO Patrick Gelsinger are among corporate insiders who scooped up their own stock amid the latest market rout that took the S&P 500 to the brink of a bear market.

With their share prices plunging, we can't help but wonder if this 'buying' is mere virtue-signaling so that the board won't fire them for their absymal loss of market cap? 

Tyler Durden Thu, 05/26/2022 - 13:20

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