Robinhood is a trading platform that lets investors trade stocks without any commission fees or the requirement of a minimum balance. The platform has grown in popularity, and it is often considered by traders with small portfolios, as well as novice traders. During this coronavirus period, where markets are experiencing a lot of volatility, Robinhood stocks under $1 have been popular investments.
The platform has a user base of over 10 million and lists over 3,500 US stocks. However, in the last few weeks, there has been scrutiny regarding the platform after it experienced outages on March 2, 3, and 9. The performance of the Robinhood platform during the coronavirus market crisis has been questioned, raising doubts about its future. Following the outages, users threatened to shut their accounts and move to rival platforms.
Nevertheless, Robinhood penny stocks still hold significant potential for investors looking to make some cash, so long as they are aware of the risks attached to trading penny stocks. Here are 3 Robinhood stocks under $1 worth keeping an eye on:
3 Popular Robinhood Stocks Under $1: Chesapeake Energy (NYSE:CHK)
Chesapeake stock has been hit hard because of the sudden plunge of global oil prices and the coronavirus pandemic. The recent drop in oil prices has put oil and natural gas exploration companies in a vulnerable situation. For instance, Chesapeake, which has a huge debt loan, is unable to service that debt with the declining oil prices.
On March 11, when oil prices crashed, the company’s bond and stock values shed most of their value. The stock tried to hold on the $0.50 support line, but the prices of energy are very low to offer it hope of survival. The company is now considering restructuring its $9 billion debt and doing a reverse-split on its stock to avoid bankruptcy.
Although a reverse split might delay any delisting of the company in the near-term, fundamentals that have weakened in the last few weeks might suggest otherwise. However, there is hope that the company’s large portfolio of assets can give it the funds necessary to pay down any additional debt if they are sold.
At the time of writing, CHK stock is down by 8% at $0.16.
3 Popular Robinhood Stocks Under $1: Groupon Inc. (NASDAQ:GRPN)
Groupon stock has lost momentum this week after rallying in the last two weeks. The stock has corrected around 30% from last week’s highs, but it is still 80% up from its 52-week low of $0.48 reported on March 18.
Recently, the company announced the departure of its CEO Rich Wiliams and COO Steve Krenzer. The company indicated that the two executives had been ousted from their positions, and Aaron Cooper, who is the company’s President of North America, will take over as interim CEO.
Although the company has been hit by the COVID-19 pandemic, it was already in trouble even before the crisis worsened things. When the company reported its Q4 earnings, the results were uninspiring; it missed estimates and showed a decline in revenue. On the bright side, however, Groupon is seeking to mount a recovery during this crisis, and the board is already searching for a full-time CEO.
GRPN stock tanked almost 9% and is now trading at $0.89.
3 Popular Robinhood Stocks Under $1: Aurora Cannabis (TSX:ACB) (NYSE:ACB)
Marijuana stock Aurora Cannabis picked up momentum in the past two weeks, and on Friday last week, it cracked the $1.00 mark after it popped double digits. Aurora recently reported underwhelming earnings results and announced that it will cut 500 jobs, which worsened investor concerns about its future. The cannabis company appears to currently be experiencing a cash crisis; Ello Capital indicates that the company’s cash flow will only keep it afloat for a few months.
However, it is still the largest marijuana company, and in Q2, its revenue was C$56 million. In fiscal 2019, its topline was C$248 million, which was almost quadruple 2018’s tally. Because of low expectations, there is a possibility that the stock might take off if it performs well in the third quarter.
Aurora stock is trading lower by 10% to $0.81 in Wednesday’s trading session.
Key Takeaway
The coronavirus has significantly impacted markets, creating volatility that penny stocks have managed to feed on. Robinhood penny stocks present a huge opportunity for investors because of the no minimum fee requirement and the no commission charges. These 3 Robinhood stocks under $1 hold potential should they turn things around during this crisis.
Featured image: DepositPhotos © burdun
