Penny Stock Info from Press Releases

By Peter Leeds

Press releases can come from various sources, but generally the companies themselves issue them. You can glean a great deal of information from the press releases that a company puts out, but like everything from a biased source, take what you read with a grain of salt.

Remember that companies issue press releases to announce positive events. As such, press releases will always sound positive for the business. For example, a company may announce a new CEO, new contract win, gaining a listing on a better stock exchange, or the award of a new patent.

Consider adding your email to a company’s mailing list or setting automatic alerts to be notified any time a certain penny stock has news. That way you get the latest press releases right when they come out. Getting the information as soon as it is available — and before many other investors — increases the value of the news tremendously.

Keep an eye on how frequently a penny stock company puts out press releases and what kind of effect the releases tend to have on the stock price. Some penny stocks announce “news” every week while others go for months without putting out a word. Some penny stocks spike at the slightest hint of optimism in a press release, while others don’t budge in price no matter how glowing an announcement happens to be.

By getting an idea of a company’s press release strategy and knowing what kind of reaction you should expect from investors, you will have a much better understanding of how to trade and profit from the underlying penny stock.