The crypto world has been buzzing over the rampant rise of the latest meme coin, Floki Inu (CCC:FLOKI-USD). Earlier this month, the dog-themed crypto shot up in value when Tesla (NASDAQ:TSLA) CEO Elon Musk tweeted a picture of his pet Shiba Inu named Floki. He has been throwing his weight around the project, which is aiming for “world domination.” But multiple meme stocks could offer even greater and more sustained returns than Floki Inu.
The rise of meme stocks has undoubtedly been the biggest story emerging from the stock market this year, and perhaps in the past decade. The meme stock phenomenon began this year, with investors placing their bets on beaten-down stocks gaining popularity on Reddit and other online platforms.
Since then, the frenzy hasn’t stopped. Dozens of stocks have enjoyed massive gains from Reddit-fueled short squeezes. The trend doesn’t show signs of slowing down anytime soon, so consider buying these meme stocks that could provide exponential returns in the coming months:
- SmileDirectClub (NASDAQ:SDC)
- Sundial Growers (NASDAQ:SNDL)
- Beyond Meat (NASDAQ:BYND)
- GameStop (NYSE:GME)
- AMC Entertainment (NYSE:AMC)
- Rocket Lab USA (NASDAQ:RKLB)
- Affirm (NASDAQ:AFRM)
Meme Stocks: SmileDirectClub (SDC)
Oral care company SmileDirectClub had a difficult time during the pandemic. Its top and bottom lines were remarkably disappointing over the past few quarters, dragging down SDC stock.
Consequently, it has drawn the attention of bears. However, this has also made SDC stock popular on Reddit forums of late, which means a short squeeze could be in the cards.
The company recently released its disappointing second-quarter results, where revenue of $174 million fell below expectations by 12%. However, its net loss of $55 million came in significantly lower than the $96 million loss seen in the same period last year.
SmileDirectClub’s long-term debt stands at a whopping $733 million compared to cash equivalents of just $377 million.
The short-interest ratio for SDC stock is around 37%, and some analysts suggest it is considerably oversold at this point. Therefore, SDC stock is ripe for a massive short squeeze in the foreseeable future.
Sundial Growers (SNDL)
Shares of Canadian marijuana producer Sundial Growers enjoyed an incredible rally earlier this year, trading as high as $4 per share. However, it now trades at only a fraction of that price after disappointing investors with its financial results.
Sundial’s growth has been sluggish over the past several quarters, pushing SNDL stock to record lows. However, its short interest remains over 25%, suggesting a short squeeze could be around the corner.
Sundial is transitioning from wholesale to retail-branded sales, which could be a game-changer for the company. Moreover, it has been making some major investments of late, such as its acquisition of Inner Spirit Holdings and a joint venture with SunStream Bancorp.
These deals could pay dividends in the future. Still, SNDL remains nothing more than a speculative play at this stage.
Meme Stocks: Beyond Meat (BYND)
Beyond Meat is a plant-based meat producer that has performed decently in the past few quarters. BYND stock, though, has failed to impress investors, generating a year-to-date (YTD) decrease of 26%.
However, Beyond Meat is gaining a lot of exposure on Reddit forums. With a short interest of more than 27%, a short squeeze could push the stock to new heights.
Thanks to growth in its food-service business, net revenue climbed nearly 32% on a year-over-year (YOY) basis to $149 million in the second quarter. However, Beyond Meat posted a hefty net loss of $19.7 million, and its management pointed to a weak third quarter ahead.
Moreover, the competition is heating up in the industry. Companies like Tyson Foods (NYSE:TSN) and more established players like Nestle (OTCMKTS:NSRGY) are expanding their plant-based offerings. Hence, things are likely to be challenging for Beyond Meat going forward.
GameStop is the original meme stock that kicked off the wild moves in the market this year. In January, GME stock was trading in the penny stock territory. But once the Reddit chatter started, its shares soared over 2,200% in just a few weeks.
These violent moves attracted substantial retail interest, so YTD returns for the stock are more than 800%.
GameStop is looking to transform its operations but is ultimately focusing on its e-commerce segment. However, with video game developers and original equipment manufacturers (OEMs) offering digital purchases and subscriptions, these moves are probably ill-fated.
Nevertheless, there’s always a strong possibility of a short squeeze with GME stock, which could make you rich fast.
Meme Stocks: AMC Entertainment (AMC)
AMC Entertainment was also the face of meme stocks alongside GameStop this year. Shares of the embattled theatre chain operator saw a whopping 301% one-day rally at one point.
Six-month returns for AMC stock are at a healthy 250%, which suggests that its hype train isn’t stopping anytime soon.
When Covid restrictions were in place earlier in the pandemic, AMC had to close down its theatres and clear the way for over-the-top (OTT) platforms to dominate the entertainment space. However, with more than half of the U.S. population vaccinated and some major releases scheduled for the fourth quarter, AMC could be set for a comeback.
The company is off to a flying start in its fourth quarter, as AMC saw its best 14-day ticket sale run since the pandemic began. There’s plenty to look forward to with AMC stock.
Rocket Lab USA (RKLB)
Rocket Lab is the newest entrant in the swiftly-evolving space industry. In September, RKLB stock doubled in value compared to its late 2020 listing price. Retail traders began piling in, which points to more short squeezes in the foreseeable future.
Rocket Lab has a healthy outlook ahead, spurred by the prospects of space tourism, future exploration and satellite connectivity. Moreover, it can effectively diversify its income streams through its space and launch services.
The goal for Rocket Labs is to provide an economical launch solution for its customer base. Most recently, it nabbed a $24 million contract from the U.S. Space Force. The company has a bright future, which will likely propel RKLB stock to new heights.
Meme Stocks: Affirm (AFRM)
Affirm is an up-and-coming fintech firm providing Buy Now, Pay Later (BNPL) services. Its portfolio includes a robust consumer app, merchant solutions and point-of-sale payment services.
Affirm recently made headlines after announcing its partnership with retail giant Amazon (NASDAQ:AMZN). Its shares have been rallying hard on Reddit forums with more than a 5% short float.
Recent financial results have been impressive, with its Q4 revenue rising 71% from the prior-year period to $262 million. On the downside, the firm posted a hefty net loss of $128 million compared to a net income of $35 million in the same quarter last year. Affirm’s long-term outlook remains bullish, though, as it continues to disrupt conventional financial institutions.
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On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.