Penny Stocks in the Red: DHX Media, Limelight Networks—But Why?

penny stocks

If you consider yourself to be an aggressive investor, penny stocks may be the market for you. Both the Nasdaq and the TSX offer these stocks, though the latter option is not for the faint of heart.

Today, despite both companies revealing important news recently, we saw two penny stocks fall into the red zone—one on the Nasdaq, the other on the Toronto Stock Exchange.

Penny Stocks in the Red: DHX Media and Limelight Networks

On August 8th, both DHX Media and Limelight Networks entered the red.

While it’s not unusual for penny stocks to fall—they pose a lot of risks—it is surprising to see these two particular stocks down today, considering what DHX Media and Limelight Networks announced recently.

1. DHX Media (TSX:DHX)

As a company, DHX Media is on a roll. At the start of the month, reports surfaced that the Halifax-based company signed new consumer product licenses for its Teletubbies in South Korea.

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Before that, on July 23rd, DHX Media announced that it closed its sale of a minority stake in Peanuts, an animated TV show, to Sony Music Entertainment (NYSE:SNE).

According to the CEO of DHX Media, Michael Donovan, this transaction not only reduced DHX’s debt but allowed the company to retain “control of Peanuts,” as well as strengthen its relationship “with a world-leading entertainment and consumer products company.”

The market, however, doesn’t seem as optimistic. Granted, it’s been a while since the announcement came out, but still, both announcements should have been positive enough to keep the stock trading in the green.

The DHX Stock

According to Yahoo Finance, as of 2:39 p.m. EDT, DHX Media is trading at $2.64 on the TSX, which puts this penny stock down 2.94%.

2. Limelight Networks (NASDAQ:LLNW)

Similar to DHX Media, Limelight Networks, a content delivery specialist, has announced positive news recently.

On July 19th, the Q2 Limelight Networks earnings report came out. In the report, we saw the company beat both earnings and revenue estimates. An increase in full-year revenue guidance was also disclosed. The next day, share prices surged over 12%.

This optimism didn’t last, unfortunately, adding Limelight Networks to today’s list of falling penny stocks.

The Limelight Networks Stock

According to Yahoo Finance, as of 3:16 p.m. EDT, Limelight Networks is trading at $4.16, which puts the penny stock down 3.26%.

The Takeaway

Are you surprised to see these two penny stocks in the red zone today, considering all that the companies have been up to/announced recently?

Check back in tomorrow for more penny stock news!

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Featured Image: Depositphotos/© Wavebreakmedia

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