Investing in Hot Penny Stocks Online – Olympics Investing

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Ideally, you want to own penny stocks in sectors that are growing and expanding when you are Investing in Hot Penny Stocks Online. This is especially true if the stock is a pure play in that sector, as the penny stock will experience a significant increase in share price. For example, when gold doubles in price, the value of the resources owned by junior gold mining companies doubles, which causes their stocks to increase in value.
Many investors wonder how important the price-earnings (P/E) ratio is in evaluating a penny stock. P/E, an important indicator for regular stocks, is the ratio of share price to earnings. In broad terms, the lower the P/E, the better bargain you are getting. In particular, many traders look for a stock with a P/E lower than other companies in its sector. On the other hand, P/E is sometimes not such a key indicator for penny stocks, because so many of these companies have no significant earnings.
 
Another factor to consider when Investing in Hot Penny Stocks Online is sales growth. If a small company has a track record of several consecutive years of sales growth, there is a good chance the pattern will continue. Experienced penny stock investors look for companies that have achieved 20% to 25% or more growth in annual sales for two to three consecutive years. This type of strong growth is a very strong indicator that future upward growth will continue.
 
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