Best Energy Penny Stocks

Alternative energy is more mainstream than ever, but fossil fuels still make up a large percentage of the energy production in the U.S. Coal is down, but natural gas and nuclear energy production are both up.

There are new opportunities for investors in renewable energy, with solar and wind production leading the way to new highs in consumption and production for the subsector. Transportation tends to lead to end-use in this sub-sector. However, energy is a concern for everyone, and that is why there are so many companies entering the market and trading at low prices. But, where do you start and how do you choose?

All of this means that plenty of money is moving through the energy sector. There are more small companies than ever attempting to service the growing energy needs of an expanding global population. The penny stock market is a great way to leverage your money to profit from the world’s energy use.

Quick Look at the Best Energy Penny Stocks:

• Gevo Inc.
• Clean Vision Corp
• SunWorks, Inc.
• Denison Mines Corp
• PEDEVCO Corp
• Meta Materials, Inc
• Powerbridge Technologies Co Ltd
• Eco Wave Power Global AB
• Fuel Tech, Inc.

Overview: Energy Penny Stocks

There are plenty of penny stocks to trade today, but this was not always the case. The 1970s brought us the beginning of the liberalized energy market. Before then, petroleum dominated both energy consumption and production, and production was dominated by the Seven Sisters — BP, Gulf Oil, Royal Dutch Shell, Standard Oil Company of California (now Chevron), ExxonMobil, Standard Oil Company of New York and Texaco (merged into Chevron).

The energy market is always one of the most affected during an economic crisis or pandemic. The oil crisis of 1973 marked the rise of OPEC and the first genuine threat to the Seven Sisters oligarchy. As different parts of the world began to understand the benefits of energy localization, international authorities began to actively break up and avoid oligopolies. The 2008 economic crisis caused many nations to overhaul their energy consumption and importation policies, pressuring petroleum exporters for fairer treatment. 

The COVID-19 pandemic continues to help break up centralization in the energy industry. Newer, cheaper forms of energy are now becoming more viable, further reducing the influence of formerly dominant companies like ExxonMobil (NYSE: XOM) and BP (NYSE: BP). There is now room for companies like First Solar (NASDAQ: FSLR), NextEra Energy (NYSE: NEE) and Brookfield Renewable Partners (NYSE: BEP) to hold a substantial portion of the market alongside them.

Innovations such as blockchain energy also create room for small companies to serve local and regional energy needs with lower barriers to entry. However, the industry shifts quickly, meaning that there are mergers, acquisitions and delistings going on throughout the year. At the same time, there is stability in the energy sector because everyone needs a power source. There’s quite a lot of market to go around, and all of these companies can sit in their respective corners and make money, for the most part.

At the same time, these companies may need to contend with larger firms that have more money and resources with which to compete. As a result, you must watch penny stocks carefully because you never know when they could take a turn and force you to exit your position. Or, you may need to buy in before the stock price goes through the roof. Remember, too, that some of these stocks may take quite a long time to grow into the large cap or blue chip stocks you were expecting to see.

Best Online Brokers for Energy Penny Stocks

Making money in energy is much easier when you have an intuitive and reliable trading platform to execute your trades. Having a great investment strategy is one thing, but one bad input or unfortunate stretch of downtime can erase the all of your research and planning. It is always a good idea to test your ideas and execution strategy in a virtual account to learn how to trade penny stocks — execution is everything in this market.

You should also look for brokers that are easy to use and manage. If you’re not sure how to work with a broker, it’s difficult to invest with confidence. Compare the features of the brokers below to determine which one is right for you because some will feel better to use than others.

Change Means Change

Energy is essential, so any change in the industry simply means that money is moving around. When money is moving, you have a chance to profit. The winners in energy investment are the people who take the time to research the industry and follow the money.

Whether you join the revolution of alternative energy or choose to squeeze your profits from oil and gas, there is money to be made on both sides. Beware volatility post-COVID as the world decides whether it will go back outside or stay in, and always do your due diligence on the individual companies that are on your radar. Yes, restrictions are lifting, but a new wave of COVID-19 could turn the energy market on its head at any time.

Remember, too, that the energy market is shifting every day. You never know which companies will enter the marketplace, if certain firms will be pushed out of the market or if mergers will make the stock market that much more convoluted. You must also remember that penny stocks are close to 0, meaning that they could lose all their value at any time. Carefully monitoring your portfolio and the performance of each asset is critical for your success. At times, it’s easier to exit these positions to protect yourself, but some penny stocks may have more growth potential, enough for you to hold these assets and invest for value.

Frequently Asked Questions

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