Tom Yeung here with your Sunday Digest.
Last week, our partners at TradeSmith teamed up with InvestorPlace Senior Analyst Louis Navellier to bring you The Ultimate Stock Strategy event.
By combining their Social Heat Score with Louis’ Stock Grader, TradeSmith’s team created a system that picks winners that are both popular among Main Street traders and have excellent underlying fundamentals for long-term gains. Think popular meme stocks like AMC Entertainment Holdings Inc. (AMC) paired with the quality of firms like Nvidia Corp. (NVDA).
I hope you tuned in. Despite choppy trading this week, three of their picks have already risen double-digits. One is up over 25%.
More gains are likely ahead. The combined system identifies companies that Wall Street often overlooks, and these firms should continue to rise as the mainstream financial media catch up.
After all, not everyone invests or trades like a middle-aged analyst working at a Manhattan investment bank.
That’s why I’d like to urge you once more to watch a replay of the Ultimate Stock Strategy Event, if you haven’t yet. In it, Louis Navellier joins TradeSmith’s Andy and Landon Swan to demonstrate how their combined systems can generate a total return 15X higher than the S&P 500 – and give away two free stocks they’re buying now.
Now, let’s talk about two more stocks that their combined system is flagging this week.
E-tail Therapy
Like every generation since the 1950s, Gen Z Americans love to shop.
The average per-person spending by this cohort surpassed that of the Silent Generation in 2022 and has continued to increase, thanks to rising incomes.
In fact, a recent study by PwC now estimates that each American Gen Z’er will spend $1,357 on gifts, travel, and entertainment this holiday season – 15% more than baby boomers.
But where do these 20-somethings shop? After all, malls are struggling, and mainstream e-commerce sites like Amazon.com Inc. (AMZN) face challenges in key categories, such as apparel. Etsy Inc. (ETSY) fell 12% this week after forcing out its CEO.
That’s where social media comes in.
More than half of Gen Z have purchased products from TikTok Shop in the past year, and this figure rises to roughly 83% when including all social media platforms. Ninety-seven percent of Gen Z consumers now research products and companies on social media before making a purchase.
That’s putting ThredUp Inc. (TDUP) on a new growth path.
ThredUp is an online resale platform that was founded in 2009. The company began as a business-focused resale-as-a-service (RaaS) provider and transitioned to a consignment model between 2019 and 2024 to directly serve this new Gen Z customer. Users can now visit ThredUp’s website and browse millions of used products from handbags to designer denim. They can also join as sellers by requesting a free “clean out kit” to help them empty their closets for cash.
It’s been an excellent pivot on ThredUp’s part. Revenues are now expected to grow 16% this year, up from 0.6% in the previous year, and the firm could become profitable as soon as 2026. After all, it’s hard to go wrong when 63% of Gen Z say they plan to buy vintage or upcycled products this holiday season.
That’s why ThredUp’s recent selloff is likely a chance to buy the dip. TradeSmith’s Social Heat Score awards the firm a 78.4, suggesting that fears over a Gen Z pullback this holiday season are overblown. In fact, Google search volumes for ThredUp are 46% higher right now than they were a year ago.
The fundamentals back this up. Louis’ Stock Grader gives ThredUp a solid “A” grade for its strong earnings momentum and excellent “follow-the-money” score.
Of course, ThredUp remains a somewhat risky bet. Shares traded at under $1 as recently as 2024 during the final phase of its pivot, and there’s no guarantee that ThredUp will remain popular among Gen Z shoppers. However, now that the firm is becoming more established, there’s a great chance that this billion-dollar company will be worth multiples of its current market value in several years.
Alphabet’s Secret Weapon
It started like a normal morning:
“Alexa,” I said to my kitchen’s smart speaker. “Read me the news.”
The answer was unexpected.
“I can’t do that right now,” my Amazon smart home device replied. “Please try again later.”
My “smart” home had gone on strike. After several hours of deadlocked negotiations, I was ready to pitch the device out the kitchen window.
It turns out that I’m not the only one to have soured on Amazon’s AI products. Across social media, people have complained about malfunctioning Alexa smart home devices and unsolicited advertisements at 1 a.m. (It turns out I’m part of the 97% who check social media product reviews.)
In its place, I’m planning to buy a product I haven’t thought about in almost a decade:
A Google smart home device from Alphabet Inc. (GOOGL).
You see, after getting caught off guard by ChatGPT’s launch in 2022, Alphabet has quietly become OpenAI’s top competitor in virtually every market:
- In March 2023, it launched Gemini 1.0 – its key rival to ChatGPT.
- In 2024, Alphabet beat OpenAI in releasing a text-to-video model.
- And in 2025, its Gemini 2.5 Pro model briefly surpassed OpenAI’s top models in quality scores.
These AI products are now getting integrated into Google’s smart home devices, phones, and browsers.
That’s turned Google’s Gemini app into a world-beating product. On October 29, the search giant announced that Gemini’s monthly user count surged 200 million to 650 million, driven by integration with physical devices and its viral image tool, Nano Banana.
This increased usage, along with strong cloud computing sales, helped Google achieve its first-ever quarter of $100 billion in sales.
TradeSmith’s Social Heat Score suggests there’s even more upside to go. The tech giant earns an 83.8 score, and fed-up Amazon customers like me could push that figure even higher.
Alphabet also does well with Louis’ Stock Grader.The company generates phenomenal returns on equity and shows solid earnings and sales growth, earning it a solid “B” grade.
Last January, I named Alphabet one of my top 10 stocks to buy for 2025. Its AI models were becoming “mind-blowingly good,” giving shares double-digit upside in the coming year.
Now that the crowd is thinking the same thing, I’m reiterating this long-term call to buy in.
Ask the Audience, Not Alexa
You likely know the hit quiz show Who Wants to Be a Millionaire?
The game show first aired in the U.K. in 1998 and quickly became a pop-culture sensation. American, German, and other versions soon followed.
The format of this show is straightforward: Contestants are asked to answer 15 general-knowledge multiple-choice questions to win a million pounds, dollars, or euros.
In addition, these hopeful millionaires are given three “lifelines” to help them along the way:
- Phone a friend for advice…
- 50-50 lifeline to remove two wrong choices…
- Or ask the audience for help.
Now, here’s a multiple-choice question for you:
Which of the lifelines are the best?
A team of German researchers at the University of Bern took this question seriously and studied over 660 episodes of the TV show. They published their answer in a 2010 paper:
Ask the Audience was the winner.
Contestants who used this lifeline got the answer correct 95% of the time, compared to 87% for the phone-a-friend helpline and 91% for the 50-50 option. In other words, asking the audience for help cut error rates in half to just 5%, down from 9% to 13%.
The same wisdom of crowds makes TradeSmith’s Social Heat Score so powerful. The system combines data from social media posts, AI queries, search volumes, and other online sources to create a single score ranging from 0 to 100 that indicates what people actually think of a firm.
It’s the wisdom of crowds in your own back pocket.
You can learn more about this powerful tool by watching the replay of the Ultimate Stock Strategy event for a limited time. In it, Louis, Andy, and Landon cover how this system works… and give away two free stocks they’re buying now.
To learn about the strategy that can help in both bull and bear markets… get details on a brand-new group of “Ultimate Stocks”… and find out how to double your money by Christmas… watch the replay now.
Until next week,
Thomas Yeung, CFA
Market Analyst, InvestorPlace
