Article: These 2 Meme Stocks Won’t Survive the Next Stock Market Crash

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These 2 Meme Stocks Won’t Survive the Next Stock Market Crash

Leo Sun,  26 March 2021

The Reddit-fueled short squeezes of GameStop (NYSE:GME) and other heavily shorted stocks earlier this year thrust the idea of “meme stocks” — equities that get aggressively promoted on social media platforms — into the broader market’s spotlight.

Some of those meme stocks actually have solid underlying businesses that could allow them to resist a market downturn. However, there are plenty of others with businesses that can’t possibly support their frothy valuations. Let’s take a look at two meme stocks that will likely burn their shareholders the next time the market stumbles.

1. Naked Brand
Shares of Naked Brand Group (NASDAQ:NAKD), a New Zealand-based retailer of intimate apparel and swimwear, surged from about $0.07 last October to an all-time high of $3.40 in late January. Nearly everyone who chased that rally and hung on got burned — the stock now trades at about $0.77 per share.

Naked’s rally had nothing to do with its fundamentals. It was identified as a short squeeze target on Reddit, and its name was cited in discussions about “naked shorting” — the illegal practice of shorting a stock without borrowing it first. Those discussions inexplicably evolved into a movement to promote the stock on Reddit, which caused it to rally alongside GameStop and other meme stocks in January.

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Article: Watch Live: GameStop Hearing On Market Manipulation

Article - Media, Publications

Watch Live: GameStop Hearing On Market Manipulation

Jonathan Ponciano,  18 February 2021

A Congressional hearing into the GameStop mania that triggered the largest weekly selloff since late October is underway, with some of the key players in the saga—billionaire Citadel CEO Kenneth Griffin, Robinhood CEO Vladimir Tenev, Reddit Cofounder Steve Huffman and the 34-year-old securities broker behind the Roaring Kitty online persona—all set to testify.

Committee Chair Maxine Waters (D-Mo.) kicked off the hearing by asking Tenev whether he misled investors on January 28 when he denied that Robinhood had a liquidity problem despite raising more than $3 billion in the following days to meet reserve requirements from the Securities & Exchange Commission. Continue reading “Article: Watch Live: GameStop Hearing On Market Manipulation”