The market is showing early signs of hesitancy, and some investors have taken that as a hint to reduce their risk exposure. While I’m not opposed to the idea — evidence suggests the fear trade is heating up — it’s usually not a good idea to indefinitely abandon the equities sector. Those who still want growth opportunities in a relevant segment should consider solar penny stocks.
Now, hold on for a second — aren’t penny stocks ridiculously dangerous? In almost every circumstance, these speculative vehicles are treacherous and not to be taken lightly. But once in a while, you may be able to get away with fighting fire with fire. While I’m not making any guarantees, this may be one of those occasions.
Penny stocks tend to be disconnected from broader market trends. While blue-chip analysts study economic indicators and rumors about Federal Reserve policy shifts, speculative investors trade on fundamentals. It’s possible that outside conditions — such as a dovish monetary policy — could affect these names. But penny stocks usually march to their own beat.
Certain conditions in both the domestic and global economies still pose challenges, including the resurgence of Covid-19 cases. In these circumstances, penny stocks may offer surprising viability. But to improve your odds, you may want to consider low-priced fare in the solar energy sector. Since climate change is one of the hot-button issues of the day, there’s generally more interest here than in other market segments.
Also, solar power may be a matter of necessity. As you may have noticed, we’ve had unusual weather across the globe that indicates climate change is getting worse. Additionally, harnessing the energy of the sun diversifies our power infrastructure, which is always a positive. With that in mind, here are seven solar penny stocks to consider:
- Solar Integrated Roofing (OTCMKTS:SIRC)
- SunHydrogen (OTCMKTS:HYSR)
- Ascent Solar Technologies (OTCMKTS:ASTI)
- Aurora Solar Technologies (OTCMKTS:AACTF)
- Principal Solar (OTCMKTS:PSWW)
- Solar Alliance Energy (OTCMKTS:SAENF)
- Fernhill (OTCMKTS:FERN)
As with penny stocks for any other sector, you should exercise intense caution when investing in these. Although banking on a high-demand space like solar tilts the odds in your favor, it’s still an extremely risky arena.
Solar Penny Stocks: Solar Integrated Roofing (SIRC)
Solar Integrated Roofing covers commercial and residential energy needs in the U.S. market. It describes itself as an “integrated, single-source solar power and roofing systems installation platform company.”
With specialties in battery backup systems and electric vehicle (EV) charging stations, Solar Integrated is a fundamentally relevant trade. But will it be profitable?
Many proponents of solar penny stocks believe so. At the start of the year, SIRC stock was trading hands at 27 cents. A month later, shares saw a closing price of $2.76. Enthusiasm was sky high. However, the Texas winter storm dampened bullish sentiment in the solar sector. As a result, SIRC plummeted back down to reality.
On April 19, the stock closed at 46 cents. From there, its price ebbed and flowed but saw no real net movement. For example, SIRC closed at 45 cents on July 22. But shares could enjoy a resurgence of bullish momentum from the broader push for clean energy solutions.
If you’ve got some dumb money funds lying around for solar penny stocks, I’d watch this space.
Technically a combination of a solar play and a hydrogen energy firm, SunHydrogen is one of the most innovative companies you’ll find among ultra-speculative penny stocks. In a nutshell, SunHydrogen’s technology converts sunlight into energy to split water at the molecular level and extract hydrogen as a clean energy source. The process is similar to photosynthesis in plant cells.
It’s a profound concept that scientists have long attempted to perform through various means. But according to the University of Southern California, clean hydrogen energy is not without its challenges.
Currently, there are two ways to get hydrogen for clean energy. One is to extract hydrogen from methane, which leads to emissions. The other is to deploy electrolysis, which requires electrical energy and thus invariably burns fossil fuels.
Supposedly, SunHydrogen offers the most economically viable solution for producing energy from the most abundant element in the universe. Therefore, speculators are incredibly passionate about HYSR stock. But like so many other penny stocks, risks abound.
HYSR got off to an auspicious start early this year, but shares quickly tumbled. Its year-to-date performance is a staggering loss of nearly 48%. Nevertheless, HYSR has cooled off its volatility, which may invite speculators to invest once again.
Solar Penny Stocks: Ascent Solar Technologies (ASTI)
A penny stock that truly deserves the designation, Ascent Solar Technologies offers tremendous upside potential for its equity unit’s cheap price tag. At the moment, ASTI is trading hands for 1.5 cents.
Normally, I wouldn’t pay attention to securities with such prices because they’re usually garbage. However, we’re talking about solar penny stocks, so I can justifiably discuss ASTI stock from an editorial standpoint.
Ascent Solar’s underlying business is solar solutions, ranging from bare modules to finished goods that can withstand extreme environments. It is particularly relevant for exploration and research and development purposes.
We’re living in strange times when social media and speculators have combined into a formidable partnership. While ASTI stock might appear to be a going-nowhere equity unit, it enjoys tremendous appeal on investment-related forums. It wouldn’t surprise me if the sheer power of the internet moves shares dramatically higher from here.
Granted, you want to be careful with a company that generated less than $70,000 in sales for 2020. But as with the other penny stocks on this list, you’ll want to keep close tabs on ASTI shares just in case.
Aurora Solar Technologies (AACTF)
Aurora Solar Technologies is a manufacturer and marketer of inline quality control systems for the solar cell manufacturing industry. The company helps corporate clients increase efficiency and profitability through “measurement, visualization and control of critical processes during solar cell manufacturing.”
Considering that long-term declines in solar manufacturing costs have helped make the industry viable, Aurora is plying its trade in a relevant niche.
Like others in this list, AACTF stock was flying high early this year. By mid-February, shares were trading hands for 59 cents. That was quite an accomplishment compared to its price of 27 cents in early January. But the Texas cold snap and the public’s loss of confidence in clean energy caused AACTF shares to hemorrhage market value.
Its quarter ended Dec. 31, 2020 wasn’t particularly encouraging — the company posted no revenue. That said, for the year ended March 31, 2020, Aurora rang up revenue of $2.36 million, up more than seven times the prior year’s result. Therefore, AACTF stock has plenty of potential to attract speculators — especially from the social media crowd.
Solar Penny Stocks: Principal Solar (PSWW)
Moving on to the more speculative side of solar penny stocks — as if the prior names weren’t speculative enough — we have Principal Solar. The company buys, owns and operates solar power projects. Its management focuses on identifying large-scale solar operations with high potential for financing and long-term ownership.
While the business sounds intriguing, you must be aware that it’s extremely difficult to determine the fundamental value of Principal Solar. Perusing its Securities and Exchange Commission (SEC) filings, the latest information I can find is its Form 10-Q — for the quarter ended March 31, 2016.
The company generated revenue of $5,010 and a net loss of nearly $409,000. It’s quite possible that Principal Solar has improved its financials over the past few years, but that’s just conjecture at this point. Adding to the list of woes, over the past six months, PSWW stock shed half of its market value.
So why bother looking into Principle Solar? Again, we’re talking about penny stocks, so this kind of volatility comes with the territory. And arguably, PSWW has a cult following anticipating a big bump in its price. If you like lottery tickets, this might be worth throwing a Jackson or two in.
Solar Alliance Energy (SAENF)
Solar Alliance Energy is an energy solutions provider focused on residential, commercial and industrial solar installations. Its customer base is spread throughout Tennessee, North and South Carolina, Kentucky, Illinois, Florida and California.
This geographic diversity is intriguing because half of these states are hot destinations for millennials. Since this generation represents the largest workforce in the U.S., Solar Alliance can benefit from a potential long-term revenue stream.
Additionally, the Covid-19 crisis could help Solar Alliance as people move away from major urban centers to the suburbs or even rural areas. Homebuyers should have greater control over the improvements they make to their home. In contrast, modifications to high-rise condos are usually no-nos.
Further, Solar Alliance has decent financials for what it is. In 2020, the company generated revenue of nearly $2.8 million, up more than 60% from 2019’s tally. Admittedly, though, profitability is a concern. Solar Alliance prints red ink on the bottom line more often than not.
Ultimately, with volatility in SAENF stock fading in recent sessions, speculators may view this as a time to get on board. As with other high-risk, high-reward solar plays, it might be worth throwing a few bucks of dumb money into the stock.
Solar Penny Stocks: Fernhill (FERN)
Under normal circumstances — and many abnormal ones too — I wouldn’t even think about including a company like Fernhill in a list. However, the holding company is the epitome of a solar penny stock, trading for one cent as of today.
If there was ever a time when due diligence was warranted, this would be it. You’ve got to understand what you’re dealing with.
According to Fernhill’s website, it’s a diversified technology holding company with interests in mobile applications, blockchain assets, fintech and artificial intelligence. Somewhere in there is alternative energy — specifically solar power and battery storage.
I tried to find some financial data for the company, but according to the SEC, the most recent information is from July 2008. Thus, we’re not dealing with a full deck here.
Then again, who cares about a full deck when you’ve got social media? Surprisingly, FERN stock has a sizable — and apparently growing — fanbase.
It’s very possible that this name could see a massive swing higher sometime in the future. I just don’t know when that will be, or if it’s even remotely likely.
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On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.