Speculation on the WallStreetBets Reddit seems to be fueling another day of huge gains in Koss (NASDAQ:KOSS) stock as the audio equipment maker is poised to be latest top-trending ticker. Similar chatter in recent days catapulted shares of GameStop (NASDAQ:GME) and Clovis Oncology (NASDAQ:CLVS) to new highs.
Stoking the talk is former Goldman Sachs portfolio manager Will Meade who yesterday called out KOSS, CLVS and movie theatre operator AMC Entertainment Holdings (NYSE:AMC) as prime fodder for the Reddit group’s focus, with each stock showing short interest above 35% and then priced under $10 a share. Meade’s Twitter profile shows he “founded $1BN hedge fund.”
KOSS stock gained 79.6% yesterday and was up about the same as of 7:30 Eastern this morning. Volume on Monday was almost 19 times the daily average and gave the maker of headphones a market capitalization of $44.4 million.
Koss has been making headphones and speakers for audiophiles since the late 1950s. I own several pairs, having first purchased old-school, over-the-ears back in the mid-70’s. Steely Dan’s “Can’t Buy A Thrill” never sounded so good.
Could KOSS Stock Ride GameStop-Style Speculation?
Credit the WallStreetBets (WSB) Reddit for a lot of market drama in recent days. WSB is a subreddit focused on boosting up shares of stocks before selling them off for profits. A subreddit is a specific online community, and the posts associated with it, on the social media website Reddit. The platform is big among users of the Robinhood app due to its ease of access to the stock market and trading.
The most recent target of the internet forum was GameStop, which has been on shaky ground lately. While investors from the subreddit did take out shares of the stock to boost it higher, conflict arose shortly after. Andrew Left, the founder of Citron Research, announced plans to live stream five reasons GME stock would fall to $20 in a tweet. That allegedly caught the interest of the subreddit, which didn’t want his bearish stance ruining the rise in the stock.
Back to KOSS stock, which had pretty much been asleep for years before last March’s pandemic crash. Most of the gains since then could be attributed to folks staying at home and wanting a better listening experience. That is, until recent days.
The Bottom Line
What to do here? There could be money to be made listening to the WSB chatter machine. But better to put your money to use on a better listening experience.
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, following fintech, agtech and property tech startups.
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