In assessing the likelihood that Vinco Ventures (NASDAQ:BBIG) stock will go anywhere, I can’t help but think of the similarities between this trend-chasing investment company and the dating game, at least from a woman’s perspective in a traditional match-up.
Like any male suitor, the underlying marketing machinery of BBIG stock is full of compelling narratives. That’s to be expected.
But at some point, the lady in question must decipher what’s true and what’s complete nonsense. While I can’t dive into all tall tales that a man might offer, every person gives off certain signals that something might be amiss. For the ladies, if a man tells you that he’s exactly 6 feet tall, you might have a liar on your hands.
Though I can’t prove it, the 6-foot-tall line has got to be the most lied-about metric in polite company. Psychologically, it’s the threshold between whether society views someone as tall or short. Therefore, it’s common for men who are a bit shy of the mark to round up to the numerically satisfying 6-foot tally.
You may notice that these same folks won’t lie about being 6’1”. There’s simply a huge difference between someone who’s 5’10” versus a legitimate 6’1”. In other words, you’ve got to make the lie stick, which brings me to BBIG stock.
It’s the Fundamentals Where BBIG Stock Falls Short
Like the 6-foot man who isn’t, I can’t shake the perception that Vinco Ventures is a relevant organization but in marketing print only. Even its equity unit is called BBIG stock, which per my InvestorPlace colleague Dana Blankenhorn stands for “Buy. Innovate. Grow.” That only provokes my suspicions more.
When a man really tries to stress that he’s 6 feet tall, he almost surely isn’t. Again, I can’t prove that statistically but here’s the point: when LeBron James says he’s 6′ 9″, you don’t see him straining to prove it. Frankly, it’s obvious that he’s way up there.
That’s the issue with BBIG stock. There’s plenty of stuff going on to make it seem bigger than it is. As Blankenhorn remarked:
Vinco is an investment company that has gotten into non fungible tokens (NFTs), launching an E-NFT platform for trading them. It also owns 80% of a short video content platform (think TikTok) called Lomotif. It also plans to spin off a second company called Cryptyde to shareholders of record Sept. 15.
On the surface, the packed relevance seems impressive. But take away the height lifts for men – here’s a company called, sure enough, the 6ft Club – and you might discover that the person claiming the threshold is anything but. Another classic quote from my colleague sums up the charade of BBIG stock:
What we’re left with is a lot of Internet buzzwords that will make you swoon. NFTs, crypto, TikTok, digital influencers … the list goes on and on. What you won’t find is a lot of revenue. BBIG reported revenue of about $2.5 million in the March quarter, and $2.7 million in the June quarter. It also recorded losses of $240 million, almost $8.50 per share. Not bad for a company selling at $7.
It was selling at $7 at time of publication. Right now, it’s closer to $6.
Nothing Without Social Media Support
At the conclusion of his article, Blankenhorn warned readers that this might all end in tears. I suppose he should clarify just a tiny bit. It could end in tears of joy if you’re well adept at deciphering the meme-trading community’s next move. Otherwise, you’d best avoid BBIG stock if you don’t like the idea of absorbing ‘BBIG’ losses.
Aside from the horrible revenue to net losses ratio, I’m not seeing anything that would give even battle-hardened speculators much confidence in trading BBIG stock beyond a few bucks for entertainment purposes. For instance, AppAnnie.com ranks Vinco Venture’s Lomotif app at 181 in the “social” category.
On the other hand, the same website ranks TikTok at No. 1 in both the “entertainment” and “overall” categories. That’s a massive gulf in terms of popularity, making it unlikely that Lomotif will make a significant dent.
Of course, anything is possible, which is another supporting angle for BBIG stock, I suppose. But that’s an awfully risky position to take for an underlying company that doesn’t seem to measure up against objective standards.
On the date of publication, Josh Enomoto 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.
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.