Are Penny Stocks Right For You?

Vertex Energy (VTNR) is a producer and refiner of petroleum products. While it isn’t necessarily a pure-play oil and gas stock, it does work in the production of motor oil and hydro-processing. It is considered one of the largest processors of motor oil in the U.S. and has several facilities worldwide.

The company is not a producer of the gasoline that goes into your car. However, given that it does produce oil in one way or another, it could stand to benefit from a vastly heightened demand. On May 13th, Vertex reported its Q1 2021 financial results. In the results, it posted a net income of $1 million with an adjusted EBITDA of $6.5 million. This is a sizable increase of around $4.9 million over the previous quarter. And, the company reported that the price of Group II+ base oils rose by nearly 20% compared to the previous year. This supports its increase in margins during this most recent quarter.

“Our strong first-quarter results which include significant year-over-year growth in gross profit, operating income, and adjusted EBITDA, were driven by a combination of increased product demand, improved margin realization, disciplined expense management, and full optimization of our Marrero and Heartland refineries.”

Benjamin Cowart, CEO of Vertex Energy Inc.

Other companies like China Xiangtai Food Co., Ltd. (PLIN) have also gained some momentum recently. It's a penny stock working on the production of animal products for a large range of consumer and wholesale meat markets. The company slaughters, processes, packs, distributes and sells its variety of pork-based meat products in China. It also offers chicken, beef, lamb, duck, and rabbit meat; however, pork is its main area of focus.

Recently, PLIN stock had seen some strong momentum. While there is no company-specific news that is causing PLIN stock to increase in price and volume, we can look at what else may be causing it. PLIN stock has shown up on various Reddit communities in the past. 

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