buying penny stocks during the holiday season

Post on 20-Feb-2017

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You may be fooled by the unseasonably warm weather we’ve been experiencing

around the country, but it is in fact November. In less than three weeks,

Thanksgiving will occur whether it’s 80 degrees or 30 degrees.

While many think of Thanksgiving as the start of the month-long holiday season, it

also serves another purpose. It’s the Friday after Thanksgiving (or even that

very night) where holiday shopping shifts into full gear.

At this point, consumers began to eagerly snap up holiday gifts and take advantage of whatever big deals are

going on. This is true both at brick and mortal stores and online as well.

As you may expect, there are numerous penny stock companies with ties to retail.

Not every retail chain is a major corporation. Smaller, yet still public,

retail chains do exist. One such company is Joe’s Jeans $JOEZ. Here’s the chart:

JOEZ is down 9% so far for the year, but you can see it’s turned up over the last

couple months. This could be a prelude to holiday sales expectations. Currently,

the stock is trading sideways around $0.30.

Investors are likely waiting to see how holiday business is shaping up before

buying further. The share price is above the important 50-day moving average

line, which will serves as stiff resistance to a drop.

Joe’s Jeans develops apparel products under the Hudson name in the US. The company has 10 full-priced retail stores

and 11 outlet stores. So, it definitely qualifies as a small retail chain.

Despite being small, the company generated $181 million in revenues over the last year. However, the business is

also nowhere near being profitable, losing $44 million over the same period.

The company also has a lot of debt and not a lot of cash. Basically, if you want to focus on sales (which is reasonable for a small company) then $JOEZ could worth buying. If you want to focus on the rest of the fundamentals, well, not so much.

Here’s the thing…$JOEZ is just one example of how you

can play the retail shopping season using penny stocks. It’s a great example because it’s a pure retail play that should

benefit from holiday shopping.

Other companies may not be as directly tied into the retail sector as an apparel

company like Joe’s Jeans. But, anything retail related could make a reasonable

play given the right price. Shipping companies are a good example.

As always, finding the right penny stock company is about doing your research

and having a plan. $JOEZ is in interesting call because the research

gives mixed results.

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