When it comes to penny stocks, most people think of shares of companies trading for pennies. The standard definition considers these as stocks under $5, but the popular opinion holds weight. The allure of penny stocks under $1 lies in their volatility and potential for gains. For example, a 5-cent move in a 50-cent stock translates to a 10% gain, while the same move in a $50 stock is hardly noticeable.

However, it's important to note that penny stocks can also collapse just as quickly as they can rise, as we've seen in many instances. The recent IPO of Edible Garden (NASDAQ: EDBL) serves as a clear example of how quickly the tides can change for penny stocks. Nevertheless, if you have the knowledge and expertise, the rewards can outweigh the risks.

Today, we will take a closer look at 10 of the top penny stocks under $1 based on social mentions and recent trading activity, with a deeper dive into the top 5.

1. IT Tech Packaging Inc. (NYSE: ITP)

Amid rising virus cases and concerns about data, particularly from China, some of the top retail brands, including Apple and Starbucks, have expressed worries about the impact of China's latest COVID lockdowns on 2022's growth trajectory. This has put a spotlight on companies closely related to China, such as IT Tech Packaging. With a focus on paper products, including facemasks, IT Tech Packaging has experienced a surge in its stock price, rallying from around $0.20 to highs of over $0.50.

2. Sesen Bio Inc. (NASDAQ: SESN)

Sesen Bio recently announced that it is conducting a strategic review for business alternatives. The company's cash and equivalents position of over $160 million is a significant point of focus. Sesen Bio was one of the hottest biotech stocks last year, but after failing to meet expectations, its stock tumbled. However, the company has plans to meet with the FDA regarding outstanding items related to another Phase 3 clinical trial.

3. Evoke Pharma Inc. (NASDAQ: EVOK)

Evoke Pharma experienced significant volatility in April when its stock price surged from under $0.40 to $1.40 in just two days. This was due to the company being granted FDA market exclusivity for its GIMOTI nasal spray. However, the stock quickly plummeted below $0.50. Evoke Pharma's GIMOTI spray is the only FDA-approved drug for treating recurrent diabetic gastroparesis.

4. Globalstar Inc. (NYSE: GSAT)

Globalstar, a personal safety satellite systems company, has seen a resurgence in bullish sentiment following its latest round of earnings. The company recorded a 22% increase in revenue in the first quarter of 2022 compared to the same period last year. Globalstar's model is based on connecting assets and transmitting data to its customers in industrial and government settings worldwide.

5. Kala Pharmaceuticals (NASDAQ: KALA)

Kala Pharmaceuticals gained attention earlier this year when analysts gave it high marks, including a $9 price target. The company's EYSUVIS platform has been added to the coverage of UnitedHealthcare, providing it with access to approximately 13 million lives. Despite recent downbeat earnings results, Kala Pharmaceuticals continues to gain interest due to its coverage deals and updates.

These are just a few examples of the top penny stocks under $1 that have gained momentum in the stock market recently. It's important to remember that while bullish moves can be made, bearish moves can quickly follow. It's crucial to stay informed and conduct thorough research before investing in penny stocks.

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