Retail investors flock to penny stocks WeWork, Amyris, Proterra
By Medha Singh
(Reuters) — WeWork, a prized startup just four years ago but now a micro-cap, and other penny stocks such as Amyris (NASDAQ:AMRS) and Proterra are the latest focus of speculative bets from retail traders, with shares of the financially struggling firms rising in strong trading volume after hitting record lows this week.
The three penny stocks, up in the range of 40% to 120%, were the most actively traded U.S. shares at 10:45 a.m. ET on Friday.
Amyris and WeWork were the second and third most traded stocks by retail investors, respectively, while Proterra was twelfth on the list at 10 a.m. ET, according to J.P.Morgan data.
Flexible workspace provider WeWork warned it could go bankrupt this week, a stunning reversal of fortune for a company that was once privately valued at $47 billion.
Biotech firm Amyris said it had filed for bankruptcy on Wednesday and planned to sell its consumer brands to improve liquidity, while electric-vehicle parts supplier Proterra filed for Chapter 11 bankruptcy protection earlier this week.
The gains on Friday come on the heels of Proterra and Amyris shedding over 90% of their value this week. WeWork has shed 17% and was on track for its fourth consecutive weekly decline.
«Trading turnover from the retail cohort tends to rise as the market experiences larger price swings,» Lucas Mantle, analyst at Vanda (NASDAQ:VNDA) Research, said.
The share moves were similar to those of meme stocks Bed Bath and Beyond and Hertz Global, where retail traders talked up companies on online forums such as Reddit.
Some of the latest speculative bets on the penny stocks were pinned on hopes of a merger and acquisition or a turnaround for the struggling businesses.
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