This is probably the reason why the market got excited following the announcement of GameStop’s stock split. At Seeking Alpha, we have developed a screen that marries hard to find short interest data with proprietary quantitative data. The output of the screen is our Very Bullish recommendations that have high levels of short interest. This is an explosive combination and we have found the screen has generated recommendations that have performed very well. Using 2019’s revenue to remove any Covid-19 impact and the current market cap of $3.1 billion, the company’s market cap to revenue ratio is 1,077x.
- A gaming hardware and peripherals specialist, CRSR stock experienced a massive bump higher in the early months following its debut on the Nasdaq in September 2020.
- Steven Cress is the Head of Quantitative Strategies and Market Data at Seeking Alpha.
- It’s at least as risky as shorting stocks with high short interest in the first place.
- Still, the rally of heavily shorted stocks has taken place against a “backdrop of very low levels of aggregate short interest,” he added, though noted there could still be significant losses for hedge funds.
- The frenzy hit new heights Thursday when several trading platforms limited their customers from making certain trades with GameStop.
The stock is up 75% from our Very Bullish recommendation in August 2021. The factor grades below exhibit the data is very strong for Dillard’s and the stock also has great fundamentals. Using $50 million for 2022’s revenue, which could still be aggressive, makes the market cap to revenue ratio 62x. While this isn’t in the stratosphere, a lot has to go right just to support today’s stock price. To their credit, social media investors have identified striking parallels between Troika Media and GameStop. And management at the two companies have engaged in startlingly similar financial restructuring plans.
Other heavily shorted stocks have been seeing a surge of interest recently as investors look for the next GameStop. American Airlines, BlackBerry and other formerly downtrodden stocks have had extreme swings in price this week. For over a decade the company has sold stock every year to cover its operating losses. As a comparison Zoom’s market cap to revenue ratio on its 2022 revenue is 21x. Starting in mid-December 2020 the share price moved above $3 and rose to $5.38 at the end of the year. It crept up during January to $7.11 and made an elevator move to $23.72 on February 16.
The Roundhill Meme ETF (MEME, $11.93) is off 15% for the year-to-date. With over 30 years of experience in equity research, quantitative strategies, and portfolio management, Steve is well-positioned to speak on a wide range of investment topics. The Securities and Exchange Commission has said it’s noticed all the volatility in the market and is taking a closer look. It’s the SEC’s job to protect investors, and the expectation across Wall Street is that investors holding GameStop at these lofty prices are likely to be hurt when its price falls.
THAT ALONE PUSHED THE STOCK UP MORE THAN 1,000%?
The Quant Ratings and Factor Grades are appropriate for both short- and long-term investors. The Value, Growth, and Profitability factors identify mispriced securities, and the Momentum and EPS Revisions factors recognize timeliness. These core investment metrics are measured to support our quantitative algorithms, and SA offers top-notch tools with customizable screens and filters to create a portfolio suited to your needs. From a trading perspective, Troika Media had around 21 million shares sold short at the end of February, a 72% short interest ratio. That’s roughly the same as GameStop’s elevated 88% figure in January 2021.
Reddit Stocks: CoreCivic (CXW)
In the last 90 days, 5 analysts have revised their earnings estimates up and zero have revised down. Trailing Twelve month Revenue and Forward earnings growth are strong with ‘A’ quant grades and 30% and 68% growth respectively. Critics used to dismiss the moonshots for GameStop and others as a sideshow, saying the excess was confined to a few corners of the market. Sharp losses for short sellers may have pushed them to sell some of their other stock holdings to raise cash, and several investors say that contributed to Wednesday’s 2.6% slide for the S&P 500.
And GameStop’s GME valuation at Wednesday’s close of $178.58 gives the company a market cap of $12.1 billion. Its market cap to revenue ratio (also using 2019 revenue) is 1.5x vs. the 0.15x as of December 31, 2020, less than four months starting a business in day trading ago. It is even worse if you use the analyst’s $5.2 billion revenue estimate for 2022 as the company’s ratio is 2.3x. From MicroVision’s first 10-K filing for 1998 the company was worth $97 million based on 6.2 million shares.
Third, I do not own the featured securities and therefore, I don’t care whether they move higher or not. Still, the meme-trading phenomenon that started with GameStop may continue throughout the new year, even if GME stock itself is starting to look long in the https://www.day-trading.info/10-best-high-yield-stocks-to-buy-now/ tooth. With that in mind, here are other possible ideas for Reddit stocks that could be the next big thing. In GameStop’s case, activist investor Ryan Cohen promised a corporate overhaul to refocus the retailer on e-commerce and other non-mall-based activities.
The video game retailer just announced a stock split.
While it gave up more than half to close at $11.77 on March 8, it was essentially range bound between $11 and $18 until the last three days. Nevertheless, WBX stock still has risk factors working against it. Mostly, the pensiveness centers on Wallbox being potentially overvalued against projected future cash flows.
What I do like about the underlying company is that it plays into the EV revolution; specifically, through the production of smart charging and energy management solutions for your home and ride. First, speculating on the next big Reddit stocks is extremely speculative. Second, I am just presenting ideas — this is for entertainment purposes, not investment advice.
Steven Cress is the Head of Quantitative Strategies and Market Data at Seeking Alpha. Steve is also the creator of the platform’s quantitative stock rating system and many of the analytical tools on Seeking Alpha. His contributions form the cornerstone of the Seeking Alpha Quant Rating system, designed to interpret data for investors and offer insights on investment directions, thereby saving valuable time for users. He is also the Founder and Co-Manager of Alpha Picks, a systematic stock recommendation tool designed to help long-term investors create a best-in-class portfolio. The stock still has very good fundamentals on growth, value and profitability.
The company also announces its March quarter results after the close today. On the date of publication, Josh Enomoto held a LONG position in GME. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines. Wallbox hits upon two major themes that some traders will find attractive.
As of the latest read (Dec. 31, 2021), CRSR features a short percentage of float of 36.6%. Combined, these figures tempt — though absolutely not guarantee — a short-squeeze trade. I’m probably going to get trashed for mentioning Corsair Gaming as a possible big play among Reddit stocks in 2022. Over the trailing one-year period heading into the first weekend of the new year, shares plummeted exactly 47%.
The U.S. govt just unlocked an $8 trillion market to move in a new direction. Kiplinger is part of Future plc, an international media group and leading digital publisher. These reasons explain why GameStop’s business has been in a state of decline for a long time now. The frenzy hit new heights Thursday when several trading platforms limited their customers from making certain trades with GameStop.
GameStop, based in Grapevine, Texas, sells video games at more than 5,000 stores, and the pandemic has been keeping customers away. More worrisome is the long-term shift by customers away from brick-and-mortar stores and toward buying games online. SwaggyStocks.com tracks Reddit’s WallStreetBets https://www.topforexnews.org/investing/should-you-invest-in-crypto/ positive and negative sentiment on stocks. In early April WallStreetBets had its first significant round of zeroing in on MicroVision. While the stock had already hit its all-time high in February, you can see from the graph that comments about the company have exploded in the past week.
