When it comes to penny stocks, you’ve really got your pick. There are sector trends, of course. However, many of the penny stocks out there tend to move independently of most markets. One of the biggest topics of conversation right now, however, is sin stocks or vice stocks. These are companies that have exposure to the guilty pleasures in life. We’re talking booze, pot, gambling, even psychedelics after this week. The idea that these industries might be more recession-proof than others has made it a draw for investors.
This week, traders looking for penny stocks to buy are looking at a few key factors. Obviously, the pending U.S. Presidential election is still waiting for an outcome. Next, we’re still in the thick of earnings season. Meanwhile, new legislation has brought things like cannabis closer to a mainstream audience. Now, states like New Jersey, Arizona, and others are building their place in legal cannabis. In fact, in the tri-state area, the Jersey legalization has now placed a focus on what New York might do next.
The garden state now adds a fully legal, new crop to the mix and the neighbors to the northwest are surely watching closely. Being that New York City carries a lot of weight for New York State, legislators are likely to be taking note of New Jersey’s latest move. But that isn’t the only news for vice stocks. Oregon and Washington D.C. are moving toward eased restrictions and access to things like psychedelics.
The District of Columbia decriminalized the drug. Oregon went further in approving a measure that will lead to the legalization of psilocybin for medical purposes in the state. So, with attention on several “sindustries”, it could be time to start paying attention to specific names before 2021.Vice Penny Stocks To Watch: Havn Life Sciences
Havn Life Sciences (HAVN Stock Report) (HAVLF) is in the psychedelic and functional nutraceuticals arena. The company is focused on two initiatives that it has already begun executing on, Havn Labs and Havn Retail. Through Havn Labs, the company aims to standardize the supply of psychedelics to support new therapies and it has already received its first Health Canada license. Meanwhile, its Licensed Dealer status will be secured by 2021 and will permit the supply and sale of regulated compounds.
Havn Life, through this license, has the ability to isolate and understand the roughly 200 compounds that create that “magic mushroom” effect.Then, much like extraction methods for things like THC or CBD distillates, Havn can then deliver these compounds to companies, researchers, and institutions. The important part to remember as someone looking at this industry now is that this practice is still very unique making Havn Life a key player when it comes to this market.
Furthermore, Havn Life has submitted an application to Health Canada to obtain a Controlled Drugs and Substances Dealer’s License for Psilocybin and Psilocin. This will be a cornerstone to Havn Labs’ ability to sell naturally-derived psilocybe spp compounds, under the Controlled Drug and Substances Act, to universities, researchers and companies.What To Watch With HAVN
In addition, we’ve got to consider the recreational/nutraceutical aspect of Havn through Havn Retail. The company will focus on microdosing, which could become a true market disruptor. The company has a unique IP and custom formulations all focused on microdosing products. Havn Life is in the final stages of product development and has submitted formulations for its natural health products to Health Canada. The aim is to have products available to nutraceutical retailers by Q1 2021, which is rapidly approaching. With a pick up in searches for “mushroom coffee” and other holistic options, Havn could be positioned to take advantage of a new trend.
Meanwhile, one of the key players in the grassroots cannabis movement and former CEO of Aphria Inc. (APHA Stock Report), Vic Neufeld has now come on board HAVN marking his stamp of approval. When discussing early-stage industries like this, track records can speak volumes. Neufeld’s success in another sindustry like cannabis could be a very important point of focus for the market as well.Vice Penny Stocks To Watch:Harvest Health And Recreation
Harvest Health and Recreation (HRVSF Stock Report) has several things going on with it this week. First, the company is reeling from big cannabis wins in the U.S. Specifically, the win in Arizona, its home state, could signal the next phase for the company’s plan.
Under the new legalization law, adults will be able to possess up to an ounce of marijuana at a time and cultivate up to six plants for personal use. Cannabis sales will be taxed at 16% with tax revenue covering implementation costs. Then it will be divided among funds for community colleges and infrastructure. There’s also justice reinvestment and public services.
Harvest currently operates 15 medical dispensaries supported by cultivation facilities. Its locations are in Camp Verde, El Mirage, Phoenix, and Willcox. There are also processing facilities in Flagstaff and Phoenix.
“We expect to apply for regulatory approvals to serve the recreational market as soon as permissible.”Chief Executive Officer Steve White What To Watch With HRVSF
Aside from its own progress in places like Arizona and, most recently, Pennsylvania, you’ve also got other industry momentum to factor in. Other marijuana stocks have come out with big updates. These include strong earnings from Innovative Industrial (NYSE:IIPR), big acquisition news from Aphria Inc. (NASDAQ:APHA), as well as earnings from Cronos Group (NASDAQ:CRON).
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When it comes to marijuana penny stocks, sympathy momentum can play a big role. We’ve seen this time and time again over the last 6 years. Furthermore, when you’ve got other tailwinds like legalization, the sentiment ticks even higher. But something to consider right now is euphoric optimism can become your worst enemy. So if you’re trading pot penny stocks right now, keep your plan in mind because things could get volatile during times like these. Also, keep in mind that there is still no clear President appointed yet. Some speculate that certain candidates could mean certain things for the future of cannabis. If that’s also your thinking, then consider the risk/reward depending on the outcome of this election.Vice Penny Stocks To Watch: Ambev SA
The Brazilian arm of AB InBev, Ambev SA (ABEV Stock Report) has mounted a multi-day recovery over the past week or so. After dropping hard at the end of October, this month ABEV stock has bounced back 8% from the October 31st lows of $2.13. What’s more, is that the company has also sparked some optimism from analysts. Citigroup upgraded Ambev to a Buy at the beginning of the month.
This may have been partially due to the company’s recent earnings. Ambev reported Q3 results last week. earnings per share and sales both beat estimates. The expected EPS was $0.02 with Ambev coming in with an EPS of $0.03. Furthermore, Analysts expected the company to do $2.33 billion in sales. Ambev reported $2.9 billion for the quarter.What To Watch With ABEV
While the company isn’t necessarily a hedge in the U.S., it is a play internationally. The company is one of the defensive penny stocks to watch. Like I said, depending on the global ecnonomy, vice stocks tend to weather storms differently. One of the bigger reasons that ABEV stock is down to begin with is the 2020 pandemic. What’s more is that the company has continued dealing with budgetary constraints.
On its earnings call, CEO Jean Jereissati, explained, “Once we have finalized our budget, have a clearer view of our plan for 2021 and beyond, and taking stock of kind of where we see the environment going forward, we will make a recommendation to the Board and update the market as needed.”
So even amid this optimism for sin stocks, it may be wise for those looking at this longer-term to monitor the financial situation of Ambev.Vice Penny Stocks To Watch: 22nd Century Group Inc.
22nd Century Group Inc. (XXII Stock Report) is another one of the vice penny stocks to watch right now. The company has built its business on a lower nicotine cigarette. One of the main initiatives for 22nd Century is obtaining FDA authorization for its VLN modified risk tobacco product.
22nd Century was granted a new U.S. patent related to the reduction of nicotine in the tobacco plant. This gave the company a way to bring very low nicotine traits into virtually any variety of tobacco. Securing FDA marketing authorization for this product is a top priority of the company and has been the source of speculation in the stock market.What To Watch With XXII
This week, the company released its third quarter earnings results. Revenue beat estimates coming in at $7.3 million compared to Wall Street’s $5.5 million expectation. Earnings per share also beat estimates. 22nd Century reported a loss per share of 3 cents while analysts expected a loss of 4 cents per share.
For XXII it will likely be a focus of the market to see what the company does as far as next steps for hitting the market with the VLN product. Securing authorizations for ultimate commercial product launch is key for the company. The company has said that discussions with potential strategic partners in the U.S. and globally will begin 90 days from obtaining MRTP authorization.