One thing you have to understand is that these penny stocks are penny stocks for a reason! When I say penny stocks I'm classifying stocks that are trading under 5 dollars. Most of these companies are outright scams! They're carrying tons of debt and haven't made a single proft as a company. What these companies do is pay stock promoters to promote their stock via faxes, newsletters, etc.
Ever gotten one of those emails or faxes that say “Buy symbol: XXXX now for a quick 100% gain, guaranteed! Then they go into why with excuses like: “This company is going to announce a 500% revenue increase!” or “I just talked to CEO, huge plans coming, buy buy buy!”
Another way companies induce hype into a company is too release what many call “fuf” news. This type of news is just a PR that the company releases that is suppose to stimulate dramatic hype into a company and make them look good all while the news may not be newsworthy at all. There's an example of a fuf news release on the next page.