We recently published a list of 10 Cheapest Stocks Insiders Are Buying Recently. In this article, we are going to take a look at where Processa Pharmaceuticals, Inc. (NASDAQ:PCSA) stands against the other cheap stocks insiders are buying recently.
Why should we be interested in affordable stocks? Some investors like to look for cheaper stocks in order to diversify their portfolios, because these penny stocks often operate in different industries than larger businesses.
Some investors’ strategy is finding nascent companies with strong growth potential, which can bring high returns once the companies have grown. Even though penny stocks often carry higher risks and are more prone to market volatility, they also offer investors more room for growth.
What are some ways to assess cheap stocks that are worth investing in? While there’s no single simple or complicated rule that investors can follow to achieve secure results, some strategies can help. One strategy is to keep track of insider trading activity. Insiders or, in other words, people in high positions within companies, such as CEOs, CFOs, directors and other executives have valuable insights into the company’s strategic moves, plans, and initiatives. A CEO’s investment in a company’s stock can sometimes signal strong confidence in the company’s future.
While both insider selling and buying can be driven by various motives, it is important to consider these moves within the broader context of the company’s fundamentals, industry trends, and overall market conditions. That’s why due diligence before any investment is of the utmost importance. However, insider trading activity in combination with other relevant determinants can offer valuable insights into a company’s capabilities, helping investors make more informed investment decisions.
What are some of the most affordable stocks insiders have been buying over the last 30 days? To find out, we used Insider Monkey’s insider trading stock screener, focusing only on stocks where at least two insiders had purchased shares recently. From there, we ranked the 10 stocks with the lowest average price per share.
Our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds, focusing on insider trading and stock picks from hedge fund investor newsletters and conferences. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
With each stock, we note the average price per share of these purchases and the stock’s market capitalization.
A syringe filled with a biopharmaceutical drug product on a light blue background.
Processa Pharmaceuticals, Inc. (NASDAQ:PCSA)
Average price per share: $0.80
Market capitalization: $2.784 million
Third among penny stocks that have seen interest from insiders recently is another pharmaceutical company – Processa Pharmaceuticals, Inc. (NASDAQ:PCSA). The Hanover, Maryland-headquartered company relies on a unique approach to developing oncology treatments. Processa Pharmaceuticals is focused on improving the safety and efficacy of existing cancer treatments. Its treatments are modifications of existing FDA-approved oncology drugs that keep the same mechanisms of killing the cancer cells.
On January 27, four insiders, including the company’s CEO, purchased $213,411 worth of Processa Pharmaceuticals, Inc. (NASDAQ:PCSA) shares at an average price of $0.80 per share. These acquisitions are a part of the company’s $5 million public offering priced at the market under NASDAQ rules.
Currently, the stock is trading at $0.59 per share, having declined 33.22% year-to-date. Over the last 12 months, its shares lost 76.30%.
For the third quarter of 2024, Processa Pharmaceuticals, Inc. (NASDAQ:PCSA) reported research and development expenses of $2.3 million, compared with $1.2 million for the third quarter of 2023. General and administrative expenses were $1.1 million, which compares to $1.0 million for the same period of the prior year. Net loss for the quarter reached $3.4 million, or $1.03 per share, compared with net loss of $2.1 million, or $1.54 per share in the comparable period of 2023. As of September 30, 2024, cash and cash equivalents were $2.9 million.
According to two analysts, the stock is a “Strong Buy,” with a 12-month stock price target of $5.0, as per data from StockAnalysis.
Overall, PCSA ranks 3rd on our list of the cheapest stocks insiders are buying recently. While we acknowledge the potential of PCSA as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PCSA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
