Penny stocks could see some more volatility in the coming months as the Federal Reserve starts cutting interest rates later this month. Historically, many traders tend to rotate to these companies when the Fed is cutting rates.
This article looks at Artificial Intelligence Technology Solutions (AITX), Intelligence Bio Solutions (INBS), and Tonix Pharmaceuticals (TNXP), which have become highly popular among day traders.
AITX stock price analysis
AITX is a technology company that builds robots through its RAD, RADR, RADM, and RADG subsidiaries. RAD makes stationary workflow automation solutions while RADM makes solutions for mobile workflow. RADR manufactures solutions for the security industry while RADG builds software for its companies.
AIT’s business has been doing well and the management anticipates that the trend will continue. In the most recent update, the company said that it was about to get to $10 million in annual recurring revenue (ARR) as it continues receiving more orders.
Its orders in the second quarter came in at 172, meaning that it will generate an ARR of $210k monthly when fully deployed. Based on its operating model, AITX sells the devices and then it starts making money through a subscription model.
AITX stock surged to a high of $0.0146 in 2023 as the artificial intelligence (AI) hype continued. It then suffered a harsh reversal and retreated by 87%, bottoming at $0.0018 in December last year.
Earlier this year, AITX stock surged to a high of $0.01 on May 21 as the AI hype continued. Most recently, it has erased most of the gains it made earlier this year. This reversal happened after we warned that the CEO, Steve Reinharz salary was higher than its total revenue. The company is also making substantial losses.
It has dropped below the 50-day Exponential Moving Average (EMA), meaning that bears are in control. The Relative Strength Index (RSI) has continued falling and is now nearing the oversold level. The same is true with the Stochastic oscillator.
Therefore, the AITX stock price will likely continue falling as sellers target the key support at $0.0018, its lowest point in November last year. The main risk to the bearish view is that it has formed a falling wedge pattern, a popular bullish sign.
AITX chart by TradingView
Intelligent Bio Solutions | INBS
Intelligent Bio Solutions is another penny stock that has become highly popular among day traders. It has a market cap of over $5.8 million and had an average volume of over 90.5 million on Monday.
The company, which is building non-invasive, cost-effective workplace drug testing solutions, reported strong financial results on Monday. Its fourth-quarter revenue figures rose by 64% during the quarter and by 148% from the same period in 2023. Revenue rose to $0.73 million in the quarter and $3.11 million in the last financial year.
INBS’s success came in from its growing installed base, which reached 1,000 readers in the United States. It then makes recurring revenue since these readers require a continuous supply of cartridges.
Despite the strong results, Intelligent Bio Solutions has been a highly embattled company whose stock has crashed from over $2,500 to just $1.80. It has even been forced to do several reverse splits to ensure its compliance with the NASDAQ listing requirements.
Most recently, the INBS share price peaked at $11.72 in February to the current $1.79. It has also formed a bottom at $1. Also, the stock is consolidating at the 50-day moving average. Therefore, the stock will likely remain in this range in the near term as the post-earnings jump fades.
INBS chart by TradingView
Tonix Pharmaceuticals | TNXP
The Tonix Pharmaceuticals stock has been in the spotlight in the past few weeks as the number of Monkey Pox cases has soared. The company, which has a market cap of over $3.14 million and had a daily volume of over 229 million on Monday. This happened as the company made progress on its Mpox vaccine.
TNXP, like INBS, has been under pressure in the past few years. Its stock has dropped by almost 100% in the past few years. It has also plunged by 98% this year alone and by 99.9% in the last five years.
This performance happened as the company continued reporting substantial losses and diluting its existing shareholders. Its annual loss in the last financial year stood at over $116 million, up from over $110 million a year earlier. Altogether, the firm’s total loss in the last five years was over $400 million.
Tonix has seen its total outstanding shares from just 392 in 2018 to over 5 million today. Its stock has remained below all moving averages while the RSI has continued falling. Therefore, the outlook for the stock is extremely bearish and could move to zero soon.
Tonix chart by TradingView
The post Penny stocks analysis: AITX, Intelligent Bio (INBS), Tonix (TNXP) appeared first on Invezz
