When approached judiciously (and fortuitously), speculative stock picks can give your portfolio a much-needed boost. Think of these bold investor choices like a baseball game in which you’re well behind on runs. With the bases loaded, you might be tempted to just launch one if you’re feeling up for the challenge. And with one swing, the entire dynamic of the competition can change.
To be sure, you don’t want to be swinging wildly at every pitch you see. And that’s the case with high-stakes stock investments. Most of the time, you want to be focused on the fundamentals, building your portfolio by a steady-as-she-goes approach. However, there are certain times when a little speculation can go a long way. Just to add to the temptation, these ideas are all based on risky stock recommendations by Wall Street analysts. On that note, get your bat ready – you’re up next.
Taiwan Semiconductor (TSM)
One of the more speculative stock picks, Taiwan Semiconductor (NYSE:TSM) is chip contract manufacturing and design company. Per its public profile, it’s the world’s most valuable semiconductor firm. However, even the mighty TSM can be vulnerable at times. For example, in the trailing one-month period, shares printed some red ink.
In July, Taiwan Semi disclosed a worrying sales forecast downgrade. In particular, the anticipated top line erosion confirmed weaknesses in smartphone and PC demand. As a result, TSM took down other consumer-tech-exposed enterprises. Still, I like my chances with TSM as one of the high-stakes stock investments.
Fundamentally, Taiwan Semi will still be crucial to the global semiconductor supply chain. Further, this importance carries significant geopolitical weight. As well, if you want to talk about high-reward stock options, institutional traders have recently sold puts and bought calls on TSM, with both actions carrying bullish intent. Finally, analysts peg TSM as a consensus strong buy with a $125 price target, implying 33% upside potential.
As a designer and manufacturer of specialized cameras and projection systems, Imax (NYSE:IMAX) obviously caters to the Hollywood machinery. However, that narrative – which seemed so attractive not too long ago – has become rather risky. As The Washington Post recently stated, the Hollywood writers’ strike is not over. By logical deduction, this circumstance imposes significant headwinds down the line.
Basically, any threat to new theatrical releases puts IMAX in rough shape. However, I believe it’s one of the compelling speculative stock picks. Over time, I believe that the aforementioned conflict will subside. True, generative artificial intelligence can write screenplays. However, nothing beats genuine artistry formed from the human soul.
Plus, the box office on a relative basis provides social entertainment for a very low cost. Therefore, IMAX will likely remain relevant. Lastly, analysts peg IMAX as a consensus moderate buy. This assessment breaks down as six buys, one hold and one sell. In addition, the average price target lands at $25.43, implying 36% upside potential.
Dave & Buster’s Entertainment (PLAY)
Seemingly on the pathway of becoming a relic of the pre-pandemic era, Dave & Buster’s Entertainment (NASDAQ:PLAY) offers a full-service restaurant, bar, and video arcade. Essentially, it’s a playground for adults, enabling people to let off some steam following a rough day at the office. However, since Covid-19, the office has transitioned to the home. Without the stress of daily office politics, PLAY does seem irrelevant.
Nevertheless, I genuinely believe this circumstance will change. For example, the return-to-office (RTO) mandate has become decidedly aggressive. Even companies that specialized in video conferencing services that allowed people to work remotely are requesting RTO for close-proximity employees. Given the unfairness of selecting certain employees for RTO based on happenstance, the possibly inevitable response is to get everyone back in.
Yes, that stinks because workers will – shock! – have to work again. But that also opens the door for PLAY to be one of the speculative stock picks. Right now, PLAY carries a strong buy view with a $56.25 price target, implying nearly 44% upside potential.
If you want to take a crack at high-stakes stock investments, look no further than JD.com (NASDAQ:JD). A China-based e-commerce firm, JD.com suffered a horrid time in the market so far this year. Since the Jan. opener, shares cratered more than 40%. Over the trailing 365 days, JD’s losses are a bit worse, indicating that the volatility is no fluke.
Nevertheless, I believe the online marketplace makes an intriguing idea for speculative stock picks. Sure, shares suffered because of the reopening of China’s economy not yielding the results economists expected. You can also peruse to your heart’s content but there are doom-and-gloom-style content that explores the possibility of an implosion.
In my view, if China can gin up some growth through policy tweaks, JD might swing higher. Obviously, it would be one of the bold investor choice. Still, it’s also one of the risky stock recommendations, with JD carrying a strong buy view. Also, the price target stands at $61.50, implying about 82% upside potential.
Planet Labs (PL)
An enticing idea among speculative stock picks tied to the space economy, Planet Labs (NYSE:PL) specializes as an Earth imaging company. Just like it sounds, Planet Labs utilizes small satellites called Doves to capture high-resolution images of our planet’s entire landmass daily. These images provide a library of data, which feature significant applications such as infrastructure planning and even defense.
Obviously, the allure of PL as one of the high-reward stock options – and yes, institutional traders have previously placed big orders that imply bullish intent – centers on the underlying space economy. According to data from McKinsey & Company, the space market could grow to a $1 trillion valuation by 2030. That’s not something you can easily overlook.
However, PL presents high risks. Since the start of this year, it’s printed a hefty double-digit loss. And the trailing one-year performance is even worse. Still, what I appreciate is that the analysts appreciate it, pegging PL as a strong buy. Moreover, the average price target comes in at $6.45, implying over 105% upside potential.
Despite a seemingly relevant backdrop, CarParts.com (NASDAQ:PRTS) – which is an online provider of aftermarket automotive parts – has struggled this year. Since the January opener, PRTS absorbed a sizable double-digit loss. Plus, it’s trailing one-year loss is a bit worse, indicating that the downdraft is no fluke. It’s incredibly frustrating.
At the same time, PRTS put up some strong numbers in the chart over the trailing five sessions. Therefore, even the skeptics might be inclined to consider CarParts.com as one of the speculative stock picks. Fundamentally, everything centers on the consumer economy. Specifically, data from S&P Global Mobility shows that the average age of passenger vehicles on U.S. roadways hit 12.5 years, a record. With more people electing to keep their cars on the road instead of buying replacement vehicles, the bullish case for PRTS seems to be selling itself.
Based in Tucson, Arizona, AudioEye (NASDAQ:AEYE) bills itself as an AI-based automation technology platform. Per its website, the company delivers a comprehensive suite of accessibility tests and fixes. It achieves this directive by drawing from the largest pool of accessibility test data. A key impressive feature of AudioEye is that its AI model empowers people with disabilities.
Still, against the framework of chart (technical) analysis, AEYE ranks among the speculative stock picks. True, it’s up in double-digit percentage territory so far this year. However, in the past 365 days, it suffered a substantial double-digit loss. Since its public market debut in 2013, AEYE is down more than 80%. So, extreme caution is warranted.
Nevertheless, with the global AI market projected to reach a valuation of over $1.34 trillion, if AudioEye meets its objectives, AEYE can veritably skyrocket.
Ultimately, that’s why analysts peg AEYE as a consensus moderate buy. Further, their average price target clocks in at $10, implying over 112% upside potential.
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.