If you thought the Reddit-induced wave of stock rallies was over, you were mistaken. Meme stocks are holding strong and might even be an investing theme all their own. Which stocks are Reddit users targeting next?
Gamestop (NYSE:GME) and AMC Entertainment (NYSE:AMC) are still at the top of the list with high short interest ratios and heightened trading activity, but they aren't alone.
What are meme stocks?
Meme stocks refer to equities with concentrated and speculative attention. The rallies behind these types of stocks occur on social media (especially the WallStreetBets subreddit, where many of the rallies are born).
This type of investment is considered speculative because trades are often based on social sentiment rather than company performance. They also might target stocks with high short interest ratios to combat the efforts of large hedge funds or other institutions.
What companies are on the Bank of America Reddit stock list?
Meme stocks are so well-known that even Bank of America has developed a stock list for Reddit users. In an era of stock market democratization, this thematic investing is vigorous.
Of course, AMC and GME are at the top of the list. There's also Richard Branson's Virgin Galactic (NYSE:SPCE), Plug Power (NASDAQ:PLUG), American Airlines (NASDAQ:AAL), and Beyond Meat (NASDAQ:BYND), among others.
The rally in Beyond Meat stock is more recent. It grew nearly 50 percent in the last two weeks after a YTD slump. Virgin Galactic is up 121 percent during the same period. AMC's popularity has lent the stock a whopping 1,500 percent growth YTD.
Top meme stocks to watch moving forward
Meme stocks come quick, and it's hard to know when the right time to hop on board is (if ever). The BYND rally is expected to continue with backing from investing firm Bernstein and Jim Cramer himself. There's also Silvergate Capital (NYSE:SI), which is a Cathie Wood buy.
To many investors' surprise, GameStop isn't dead and gone. GME shares have gone up 45 percent this week, with highs just 26.8 percent below their ultimate January peak. Given the legendary nature of that bull run, the current valuation isn't a small feat.
Palantir Technologies (NYSE:PLTR) and BlackBerry (NYSE:BB) are also a part of the conversation on WallStreetBets. For BlackBerry, a strong and intentional shift to security technology is helping spearhead the movement, but so is the more than 10 percent short interest float.
No one knows what happened to 1847 Goedeker (GOED) stock on WallStreetBets
Shares for 1847 Goedeker soared 266 percent overnight, and nobody could figure out why. Since then, the stock's price has dipped 88 percent, and the company is still in the red YTD. 1847 Goedeker reports that it doesn't know what caused the volatility.
GOED stock is a suspected meme stock due to its high short interest ratio, small float (outstanding shares), and modest market cap. It isn't clear whether the rally behind GOED is over or just getting started—but the same can be said for the rest of these sentiment-inspired stocks.