When it comes to penny stock investing and buying inexpensive
stocks, sometimes investors think that they can find bargains for
just a few dollars a share. Sometimes they are right - but other
times these penny stocks can expose your portfolio to big risk
and lose you a bundle in a hurry.
Penny stock investing tends to be riskier than investing in
large cap stocks, but that doesn't mean you have to settle for
losers in your quest for big penny stocks that take off. Here are
11 penny stock losers to avoid:
ICO Global Communications Holdings (
ICOG
)
Industry:
Wireless Communication Services
Market Cap:
$418.3 million
ICO Global Communications Holdings
(
ICOG
) is a development-stage mobile satellite service operator with
one medium earth orbit satellite currently functioning.
ICOG also has 10 additional satellites in various stages of
completion. While this penny stock is up 52.8% since
January, it has started to decline in recent weeks, and is down
-3% since July 8. Interestingly, ICO has not made progress
on any of its satellites since 2004, due to a disagreement with
the satellites' producer, Boeing. That's not a very encouraging
sign and tells me investors should steer clear of this penny
stock.
Antares Pharma Inc. (
AIS
)
Industry:
Health Care Equipment
Market Cap:
$128.6 million
Focusing on self-injection pharmaceutical technology and
gel-based products,
Antares Pharma Inc.
(
AIS
) has seen a -21.5% decrease over the past month. That's
much worse than the broader markets, as the Down Jones Industrial
Average and Nasdaq are down -2.9% and -5.1% over the past month,
respectively. The New Jersey based AIS has a multi-product deal
with
Teva Pharmaceutical Industries
(
TEVA
), and is involved with the production of various disposable and
reusable auto injectors. That's a plus, however, experts have
predicted and earnings decrease over the next two quarters for
this penny stock. That has turned me off Antares.
Axcelis Technologies Inc. (
ACLS
)
Industry:
Semiconductors
Market Cap:
$179.1 million
Penny Stock
Axcelis Technologies Inc.
(
ACLS
) designs, manufactures and services semiconductor chips, while
also providing service, support, equipment upgrades, spare parts
and customer training. ACLS works with some notable
technology companies including
Intel
(
INTC
),
IBM
(
IBM
),
Texas Instruments
(
TXN
) and Samsung. While Axcelis was up 68.8% from January to May,
the stock has fallen sharply since then, and is down -25.9% over
the past three months. Additionally, this penny stock has
underperformed earnings estimates three of the last four
quarters.
Tower Semiconductor (
TSEM
)
Industry:
Semiconductors
Market Cap:
$278.6 million
Tower Semiconductor
(
TSEM
) is an independent specialty foundry that manufactures
semiconductors. This penny stock's products are used in a
wide range of consumer electronics including personal computers,
medical device products and automotive products. With a
-12.5% decrease over the last months Tower's stock is currently
trading at $1.39 per share and has slightly underperformed the
broader markets. Also counting against TSEM is that Tower
has missed analysts' earnings estimate three of the last four
quarters.
RAM Energy Resources Inc. (
RAME
)
Industry:
Oil Gas & Consumable Fuels
Market Cap:
$145.3 million
Working primarily in Texas, Louisiana and Oklahoma,
RAM Energy Inc
(
RAME
) is an independent oil and natural gas company involved in the
exploration, acquisition, development and production of oil and
natural gas properties. Ram has seen a decrease of -19.6% in the
last month, and is down -9.8% for 2010. With a current
stock price of $1.84, this penny stock has underperformed
analysts' earnings estimates two of the last four quarters.
ChipMOS Technologies Ltd. (
IMOS
)
Industry:
Semiconductors
Market Cap:
$109.2 million
ChipMOS Technologies
(
IMOS
) is a holding company that provides several testing services for
various types of semiconductors. While the Taiwanese
company may be up on the year, this penny stock has slid -19.8%
in the last month. In its latest earnings report, ChipMOS
announced a profit margin of -16.2% as well as a return on assets
of -6.9%. This stock has remained anything but stable over
the past few months.
Quest Capital Corp. (QCC)
Industry:
Diversified Financial Services
Market Cap:
$209.3 million
Quest Capital Corp
(
QCC
) provides real estate mortgage financing to owners of land,
multi-unit residential buildings and commercial properties.
Generating revenue through interest on its loans, this penny
stock has remained stable and is up a bit since mid-June.
However, Quest's latest income statement has analysts feeling
uneasy as the financial service provide reported a loss in
revenue of -18.6% as well as a quarterly revenue growth of
-38.2%.
Quaterra Resources Inc. (
QMM
)
Industry:
Metals & Mining
Market Cap:
$141.1 million
Mining and exploration company
Quaterra Resources Inc.
(
QMM
) is involved in indentifying, acquiring and evaluating prospects
in mining-friendly jurisdictions. Focusing on precious
metals and base metals in Mexico and the western United States,
this penny stock has seen a decrease of -39.8% in 2010.
Despite the announcement in June that Quaterra will partner with
Grande Portage Resources Ltd. in an effort to explore the Herbert
Glacier gold property, near Juneau, Alaska, Quaterra still
remains a risky and underperforming stock.
CombinatoRx Inc. (CRXX)
Industry:
Biotechnology
Market Cap:
$127.2 million
Biopharmaceutical company
CombinatoRx Inc.
(
CRXX
) develops drugs focused on the treatment of pain and
inflammation. The penny stock, which merged with Neuromed
Pharmaceuticals in 2009, conducts preclinical and clinical trials
while seeking intellectual property protection for its technology
and products. Trading for $1.43 per share, CominatoRx has
dropped -12.2% over the past month. While the Massachusetts based
company was performing well earlier in the year, its recent slide
has analysts ready to sell.
Ladenburg Thalmann Financial Services (
LTS
)
Industry:
Capital Markets
Market Cap:
$188.1 million
Ladenburg Thalmann Financial Services
(
LTS
) is involved with investment banking, equity research,
independent brokerage, advisory services and asset management
services. LTS has seen steady decline over the past three
months, and is down 17% since mid-April. With a stock price
of $1.09, this penny stock missed the earnings estimate by a
whopping -200% last quarter, and is projected to be in the red
this quarter as well.
Westell Technologies Inc. (
WSTL
)
Industry:
Communications Equipment
Market Cap:
$106 million
Westell Technologies Inc.
(
WSTL
) is a holding company that distributes telecommunications
products, which are sold primarily to telecommunications
companies. This penny stock is also involved with the
production of DSL modems for homes and small offices. While
Westell's stock is up 31.7% since the start of 2010, its earnings
have certainly leveled off. Up just 1.9% over the past
month, Westell's stock price of $1.58 has analysts and experts
concerned.
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