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Most Speculative Stocks? (biggest potential upside)

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  • Jan 14th, 2019 11:42 am
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Deal Addict
Jan 27, 2016
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Not if you know what your doing and have experience. When people sale penny stocks, automatically people think crazy risky. Well the “penny” stocks found on the venture aren’t the same as the Ones in the states that trade a fractions of a penny. In the end, a company no matter its net worth, is still all about their balance sheet and if they make money. If you find stocks that have solid financials and are cash flow positive or soon to be, that’s how you make the big bucks. My opinion anyways
ccyk wrote:
Mar 15th, 2018 11:57 pm
Playing blue chips and index in-the-money options or on margin is safer than these penny stocks lol
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Apr 21, 2004
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organeer wrote:
Mar 15th, 2018 10:31 pm
Really interesting. Worst case scenario I never considered it that way. My worst case scenario was that they were pumping and dumping it themselves and were going to buy out the company at a dirt cheap share price (ie. way lower than $2)

I found the article where they're just running a huge loss every quarter. This was early 2017. Maybe some of that loss is royalties to Glencore. Anyway, they have sketchy accounting and are being investigated by the SEC. Also, it was Glencore's execs that was doing the sketchy accounting. So, despite the numbers, it's a huge speculation on what Glencore really wants to do with the company.

On the plus side, the SP jumped when they actually turned their operations back on. An advantage over juniors is that they are actually producing huge amounts of cobalt now as compared to juniors outside the DRC. Glencore also signed that deal with a Chinese battery maker yesterday for 5 digit metric tons of cobalt ore...They can only get that from Katanga...But this goes back to my first point - I don't know if they're going to be making Katanga sell their Cobalt to Glencore for dirt cheap before Glencore sells to the battery maker at a reasonable price. There's no real management right now because the last one got kicked out and they've spent 75M to hire an agency to review Katanga's previous accounting reports (I saw on Glencore's most recent annual report) that is giving conference calls either. This is why Katanga is the epitome of speculation right now.
Did you buy some KAT in the past or today?

It's behind a paywall but:
https://www.wsj.com/articles/glencore-u ... 1528828978
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Jul 27, 2017
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alanbrenton wrote:
Jun 12th, 2018 3:23 pm
I think Katanga will a decent spec stock now that settlement had been reached. I went for some shares at 1.11. :)
with all respect to those that buy penny stocks

I just dont get why folks do it, why they buy them, watch them pop then pull back

is there anyone out there that have penny stocks that sell on a 10% or 20% increase or is it the promise of the golden egg that the stock will double or triple?

I need to educated on penny stock investing & exiting a position... because I simply don't get why investing in penny stocks folks seemingly take a different approach to investing in a $25, $50 or $100 stock?

is penny stock investing 'all or nothing'?
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Apr 21, 2004
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porticoman wrote:
Jun 12th, 2018 4:44 pm
with all respect to those that buy penny stocks

I just dont get why folks do it, why they buy them, watch them pop then pull back

is there anyone out there that have penny stocks that sell on a 10% or 20% increase or is it the promise of the golden egg that the stock will double or triple?

I need to educated on penny stock investing & exiting a position... because I simply don't get why investing in penny stocks folks seemingly take a different approach to investing in a $25, $50 or $100 stock?

is penny stock investing 'all or nothing'?
No clue and not brilliant enough to respond to your queries but Glencore owns 80+% of KAT so trying to pulverize KAT is probably not at its best interest. KAT is a puppet all right but $5.6b debt to be wiped out soon.

KAT has a long history on the TSX and it was trading at much higher multiples, likely with a much lower o/s share count.

https://www.reuters.com/article/us-time ... SKBN1J82QX


Definitely agree that penny stocks with no underlying assets = surefire way of losing money in the long run.
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alanbrenton wrote:
Jun 12th, 2018 4:46 pm
No clue and not brilliant enough to respond to your queries but Glencore owns 80+% of KAT so trying to pulverize KAT is probably not at its best interest. KAT is a puppet all right but $5.6b debt to be wiped out soon.

KAT has a long history on the TSX and it was trading at much higher multiples, likely with a much lower o/s share count.

https://www.reuters.com/article/us-time ... SKBN1J82QX


Definitely agree that penny stocks with no underlying assets = surefire way of losing money in the long run.
again on KAT looking just at the chart & the income/earnings of the past 5 years, why suddenly is this going to be a $3, $5 or $10 stock before the end of 2018?

huge amount of outstanding shares with daily average below one million shares other than the 7.5 million today

so where is KAT headed- it's anyone guess

good luck & I do wish you well that you make some money on this & have set your milestone exit price(s)

https://web.tmxmoney.com/quote.php?qm_symbol=KAT
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ccyk wrote:
Mar 15th, 2018 11:57 pm
Playing blue chips and index in-the-money options or on margin is safer than these penny stocks lol
^ that

in fact in the money call spreads on huge IV equities along with either selling out of the money naked puts or out of the money naked put credit spreads

find a nice 3 million plus average volume stock with huge IV, lots of open interest & sell either a covered call in the money or simple do in the money call debit spreads

other than doing this day trading, there are so many other possibilities compared to penny stocks
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porticoman wrote:
Jun 12th, 2018 5:10 pm
^ that

in fact in the money call spreads on huge IV equities along with either selling out of the money naked puts or out of the money naked put credit spreads

find a nice 3 million plus average volume stock with huge IV, lots of open interest & sell either a covered call in the money or simple do in the money call debit spreads

other than doing this day trading, there are so many other possibilities compared to penny stocks
So you only do VIX?
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Nov 9, 2013
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I would add CJR.B to this list as a speculative stock with high upside potential. It's ugly and the market hates it, but it's super cheap. The catalyst would be i) paying down debt which management keeps doing or ii) a buyout at a premium to today's prices.

The yield is also ~ 16% although the dividend may get cut soon.
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alanbrenton wrote:
Jun 12th, 2018 5:21 pm
So you only do VIX?
not just VIX, there are others

treva84 wrote:
Jun 12th, 2018 5:21 pm
I would add CJR.B to this list as a speculative stock with high upside potential. It's ugly and the market hates it, but it's super cheap. The catalyst would be i) paying down debt which management keeps doing or ii) a buyout at a premium to today's prices.

The yield is also ~ 16% although the dividend may get cut soon.
^ that

corus say they have plenty of cash, then again

my wild guess is dividend cut if the stock drops below $6 & stays there for 30 continuous days

I bought cjr.b below $6 & immediately sold in the money covered calls, double bang on that + dividends
Newbie
Nov 19, 2017
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@alanbrenton

I have been picking up some more, and have been selling some also. To be honest, I'm in the red right now. The removal of debt is good, yes, but I suspect some volatility for the stock price still. Removal of the debt will be on KAT shareholders, as more KAT shares will be issued to pay off this debt. Given that KAT's market cap is ~2.5 B, and they want to pay off ~$5.5 B of debt, this tells me there is going to be serious dilution, meaning there's going to be serious stock price movements. Furthermore, they haven't told us exactly when the transaction will occur, nor have they told us the price at which additional shares will be issued. Today there was some huge volume (10M) and significant increases in stock price. I expect there to be more in the coming days, and so it is currently a trader's zone.

Does anyone else see other outcomes that I may be not seeing?
Newbie
Nov 19, 2017
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I spent a few more hours looking into this. I think there's a lot of confusion because of a line in the WSJ article saying that Katanga Mining, the company, (KAT.TO), is going to be giving out additional shares to produce $5.6B, with which it's going to give to KCC.

I don't think this is the case.

I read the official statements in detail multiple times, found here: http://www.katangamining.com/media/news ... 06-12.aspx

As "ELI5" as I can, this is the situation, and what has happened to it:
1. KCC has debt, and it pays interest to Katanga, and Katanga to Glencore. The interest rates are really high. Glencore doesn't care because they're making a lot of $ off of interest from KCC, but DRC spoke up against this. Think of it as KCC is holding a huge credit card debt with high interest, and while Glencore/Katanga own a majority 75% of KCC, they are doing nothing to address it (ie. for a credit card debt holder, the "responsible" think to do would be to pay off your debt or solve it somehow). So, DRC wants to say, look, dissolve the company.
2. What happened is Katanga Mining forgave debt - this is how it was done: KCC is to convert its debt into equity. It is KCC that issues additional shares to cover its debts. 75% of these new shares go to Katanga, 25% of these new shares go to Gecamines/DRC. All previously held shares are diluted to zero.
3. KCC used to have ~$9B in debts, and this move reduces the 9B by ~5.5B, to ~3.5B. KCC continues to pay interest to Katanga and Glencore on this $3.5B, but the interest rates have been renegotiated to 5.5-6%.

Net effect: The "debts" have been restructured so that a lot of it has been forgiven, and the rest is now on a reasonable interest rate payment, still to Katanga/Glencore. DRC is ok with this because now all of KCC's earnings aren't going to Glencore via "huge credit card debt style" payments. Huge chunks of debt have been forgiven. Glencore/Katanga have also paid Gecamines ~$0.5B in a bonus to cover various things from the past and present. In turn, Gecamines/DRC are dropping their legal actions via courts to dissolve KCC.

In conclusion, Katanga Mining (KAT.TO) shares aren't going to be further diluted, and that phrase in the WSJ article is just wrong. This is the DRC, and KAT is a huge hit for traders, so where the price will go in the future is hard to say, however, the KAT share price went up today because this is general is good news for everyone, including KAT shareholders.

This is not the first time "reputable" news sources have just straight up incorrectly reported company actions. Just a few months ago, Globe and Mail + Reuters reported that Enbridge was going to sell >7B$ in assets in the short term. They published this before open, and on the day of the ENB conference call. This was the first question institutions asked the CEO (I was listening live), and his reply was that he also read that article that morning, was surprised, and said that it goes to show that even if it is a generally reputable publishing company, you have to take phrases (e.g. ENB to sell 7B of assets soon, or Glencore said Katanga is issuing 5.6B in shares) with a grain of salt and look into the details...

I welcome others to read into this and have some constructive discussions here.
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Over at Stockhouse, someone reached out to Glencore and was informed there will be no KAT common shares dilution.

The WSJ article is incorrect.

Copper on the rise. Cobalt at 42 ( I read). KAT will open strong.

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