If there’s any lesson to be learned about the novel coronavirus as it relates to the investment market, it’s that the old guard is on the cusp of change. Prior to the pandemic, one of the biggest debates between analysts was the tug-of-war between the fundamental and technical approach. Today, we need to add a new methodology: analyzing the chatter behind Reddit stocks.
Laugh all you want. The power of the internet has more than proven itself, driving to the forefront the concept of the meme stock. In fact, a few Wall Street hedge funds took a beating over the short positions they took on certain embattled companies. Then came a wave of bullish hornets swarming in, devastating the bears. The era of Reddit stocks had arrived.
Moreover, this might not be a one-and-done phenomenon. As you know, millennials grew up during the advent of the internet. All members of Generation Z know nothing but digitalization. Therefore, to these folks — that is, the relevant generations — betting on Reddit stocks is second nature to them, just like hard candy is to baby boomers.
But it’s not just the chatter that you find on social media platforms that drive valuations. True, some Reddit-inspired plays are garbage, pure and simple. However, others have serious catalysts linked to them that could result in hefty gains. Here are seven Reddit stocks to keep on your radar:
- Marathon Oil (NYSE:MRO)
- cbdMD (NYSEAMERICAN:YCBD)
- MindMed (OTCMKTS:MMEDF)
- Spectrum Pharmaceuticals (NASDAQ:SPPI)
- CEL-SCI (NYSEAMERICAN:CVM)
- Quizam Media Corp (OTCMKTS:QQQFF)
- Castor Maritime (NASDAQ:CTRM)
Of course, none of this is meant to be comprehensive research. While wagering on popular social media trades is fun, you want to make sure that you got the fundamentals squared away. Please perform your due diligence before engaging in any of these Reddit stocks.
Marathon Oil (MRO)
With encouraging progress regarding the U.S. battle against the novel coronavirus, many investors bought shares of oil firms. Indeed, if you read up on Reddit stocks to buy, you would have noticed that the bullish frenzy started before Covid-19 cases started to dip. One of the beneficiaries of this positive sentiment was Marathon Oil, with MRO stock being a commonly discussed topic on social media.
Aside from the receding pandemic, another catalyst is the Suez Canal crisis. As I’m sure you’ve heard, a vessel has been stranded on this critical shipping lane, basically ending up perpendicular to the lane and blocking all other ships. Granted, it’s old news. But what isn’t known is how much of an impact it will have on the global economy.
According to an earlier CNBC report, the blockage may last weeks. The most recent report indicates that the vessel in question has been partially refloated but that we shouldn’t cheer prematurely. Cynically, though, it could be just what MRO stock needs to continue its upward trajectory. Since the canal connects trade between Asia and Europe, oil prices could rise because of the supply disruption.
Keep in mind that it’s not a perfect catalyst. Due to Covid-19-related lockdowns in Europe, demand there could wane, which may result in a muted rise in prices. Still, if the crisis lasts longer than hoped, Marathon is one of the Reddit stocks to watch like a hawk.
If you ever scoured social media for Reddit stocks to buy, invariably, you are going to come across cannabis investments like cbdMD. I’ve stated this many times but the Pew Research Center reported that a majority of Americans (two thirds to be more precise) support marijuana legalization. Within this figure, 76% of millennials state that the green stuff should be legal.
True, cannabis plays — especially those on the riskier end of the spectrum like YCBD stock — present challenges due to market pricing unpredictability. Nevertheless, all botanical investments enjoy a fundamental demographic tailwind. As older demos age out and away into the great unknown, we will see a paradigm shift in how we view cannabis.
What’s exciting about cbdMD is that in the interim, the full federal legalization debate doesn’t matter as its exclusively focused on non-psychoactive cannabidiol (CBD) products. Further, cbdMD formed a new subsidiary called “cbdMD Therapeutics LLC.” Its mission will be to deliver natural therapeutics that will replace opioid treatments.
This is one of the biggest catalysts among Reddit stocks since overdose deaths connected to synthetic opioids have been accelerating during this Covid-19 crisis. That’s according to the Centers for Disease Control and Prevention, meaning that cbdMD is on the frontlines of this terrible situation.
Will it be enough to boost YCBD stock? I hope so because I own shares but, objectively, this is still a space worth watching.
Initially, when I came across the investment narrative of companies researching and developing psychedelic medicines, I had the same thought as everyone else: shrooms? Is that legal? Of course, anything that has an air of illicitness is like a Pandora’s box begging to be opened. If you follow Reddit stocks, you know that many investors just had to get involved, including yours truly.
Just for the record, I’d like to state that I’m not chasing the bandwagon. I was among the first to discuss MindMed as a specialist in the field of psychedelic-based therapies. While this investment category is grinding through growing pains, MMEDF stock has been a clear winner despite some recent volatility. However, if you’re intrepid enough, I believe the red ink presents a buying opportunity.
Specifically, psychedelics present a viable alternative to synthetic opioids, as I mentioned above with cbdMD. Before the pandemic, the opioid plague was the crisis that the mainstream media covered. Now, we’re onto the more immediately pressing coronavirus and its multiple variants.
That doesn’t make the opioid crisis any less of a problem. Not only are we seeing overdoses, we may also be seeing increases in self harm due to the pressures of the lockdowns and economic woes. To be clear, it’s a topic that needs greater research. However, I’m more than willing to bet that suicides are up in 2020 over 2019 — we’re awaiting the official data.
This is an ugly catalyst admittedly but it’s a painfully realistic one. I’d take a close look at MMEDF stock with your speculation funds.
Spectrum Pharmaceuticals (SPPI)
Writing these gallery slides gives me an opportunity to discuss some opportunities that often don’t make the rounds as single-stock feature pieces. Frankly, most of these companies I’ve never heard about before. However, perusing through popular Reddit stocks with upcoming catalysts, I found Spectrum Pharmaceuticals.
Billed as a biopharmaceutical firm “focused on acquiring, developing, and commercializing novel and targeted drug products, with a primary focus in hematology and oncology,” SPPI stock intrigues because of the underlying sector’s propensity for wild gains. True, you must be aware that it could go the other way. Therefore, I wouldn’t put a single cent more into SPPI than you can afford to lose.
Still, if you can stomach the potential volatility, Spectrum attracts attention because of its drug Rolontis, an “investigational granulocyte-colony stimulating factor (G-CSF) analog.” The Food and Drug Administration initially had an October 2020 date for an assessment and approval of Rolontis. According to the latest information, this has been pushed back to May 2021.
Should Rolontis deliver the goods, this could be an amazing catalyst for SPPI stock; hence the chatter on social media. But as I said, this is a risky setup so perform your due diligence before getting involved.
Ironically, one of the hardest-hit segments of the investment market was biotechnology and pharmaceuticals. If the company in question didn’t pivot to Covid-19 in some way, whether through treatment, vaccine or testing kit development and manufacturing, it was often left dead in the water. However, with new daily infections receding, now may be the time for speculators to reconsider this space.
Among Reddit stocks, excitement has been brewing over CEL-SCI, billed as a “pioneer in cancer immunotherapy.” In addition to cancer, CEL-SCI also directs research and development resources toward autoimmune and infectious diseases. Interestingly, the company operates under the philosophy that treatments should boost the immune system before “active” methods like surgery and radiation are deployed.
Regarding catalysts, CVM stock is likely to move on developments regarding its investigational therapy Multikine, which may be a potential treatment for head and neck cancer. CEL-SCI is currently finalizing its Phase 3 trial results.
If you’re a risk-on type of person, CVM stock is just for you. Secure a strong result and you’re looking at a possible to-the-moon event. Otherwise, it could get messy.
Quizam Media Corp (QQQFF)
I must say that I’m fairly familiar with marijuana … stocks that is. However, Quizam Media Corp was an unknown business to me prior to my research into popular Reddit stocks with upcoming catalysts. Billed as “a growing chain of cannabis retail dedicated to customer service and the best quality product,” I was intrigued. Therefore, I attempted to analyze its financials which Quizam has posted on its website.
Unfortunately, at the time of writing, I came across several “404 Not Found” errors. I’m not suggesting that there’s something fishy about Quizam. But I will say it’s not the greatest look for QQQFF stock. So, to cover my hind end, please with sugar on top, do your darn due diligence!
Nevertheless, I’m going to include Quizam on this list of Reddit stocks because popular stock-picking guru “Rigatoni” mentioned on his Twitter feed that “More Growth underway, no Debt, 5 stores opened with expansion.”
Fundamentally, QQQFF stock benefits from the increasing calls for full legalization of cannabis in the U.S., which would theoretically open up international commerce channels. Still, this is more of a sentiment play in my opinion. Again, perform extreme due diligence before proceeding.
Castor Maritime (CTRM)
Castor Maritime is a tough one because I might generate multi-tiered hate mail for this. Let me give you some background. First, I discussed CTRM stock for Benzinga, noting that one of the catalysts for shares was the power of the internet. I stated “Social media users have coined the term ‘YOLO’ for this phenomenon, which stands for ‘you only live once’.”
Fairly quickly after publishing, CTRM stock took off like a rocket. But a month-and-a-half later, I got the tap on the shoulder to write about Castor for InvestorPlace. At that point, my tune definitely changed toward the negative side of the picture because the context had changed. I’m glad I was skeptical because shares slipped about 17% from the second publication date.
Now, what should investors do? Did CTRM fall enough to justify another ride? This being one of the more popular Reddit stocks, there just might be another upside swing in this. Castor announced four additional vessels to its fleet, which indicates that management is confident about an economic recovery.
If you decide to play, just do so with “dumb money.”
On the date of publication, Josh Enomoto held a long position in YCBD and MMEDF.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.