7 Meme stocks to buy before they soar to new highs in 2023
Memes are simply images and videos containing humorous text that tend to spread quickly across the internet. Combine them with stocks and you get wallstreetbets. This is where the majority of information about meme stocks is communicated. For an easier to navigate list of meme stocks, investors can go here. This is where all the companies described below were found. These stocks are not risky overall despite the reputation that investing in meme stocks may have. There are a few bets to be sure. But these are supported by the reasoning of commentators, which makes sense. With that said, let’s get into these investment-grade, investment-grade stocks.
When you invest in meme stocks, Nvidia (NASDAQ:NVDA) is by far the most talked about stock on memestocks.org. It also happens to be a well-respected company with a lot of positives worth understanding. Meme stocks have a reputation for being risky. Nvidia, despite being one of the biggest companies in the world, is certainly risky as well. It carries a beta of 1.77, which means it moves much faster than the entire market. It produces quick gains but also produces quick losses when the market reverses. That said, Nvidia is currently riding a massive upside. In fact, it more than doubled in 2023 after starting at $148. It is currently trading at $311, not far from the pandemic highs of $324 hit in late 2021.
Much of the discussion on wallstreetbets revolves around whether NVDA is a bubble stock ready to burst. It’s certainly more than fully priced right now. But NVDA is the king of AI chips and it should be able to drive it for a while until the data suggests otherwise.
When we also talk about investing in meme stocks, AMD (NASDAQ:AMD) is a strong point to consider. With Nvidia, this is also part of AI history. The idea is that companies also manufacture their own chips and buy from AMD. One particular commentator refers to Nvidia’s CUDA GPU programming platform and its eroding moat. If and when this position deteriorates, AMD should logically be able to recover a piece of the pie. Even better, AMD is expected to continue growing this year and next. Tech stocks have stabilized after a dismal 2022.
Microsoft (NASDAQ:MSFT) is another solid bet when investing in meme stocks. Like the previous ventures discussed above, most conversations around MSFT focus on the AI boom these days. Even better, this year, the company is expected to report about $211 billion in revenue. That would represent a 1.8% increase from $207.6 billion in 2022 sales. That’s a modest bump, but investors should remember that the pandemic has accelerated technology to unsustainable levels of growth.
Here’s the kicker: Microsoft is expected to hit $235 million in sales by 2024. That would be 11% growth if correct and arguably justifies all the hype going on about MSFT. It’s also very easy to argue that Microsft is entering another pandemic-like growth opportunity based on its AI investment in OpenAI. It makes sense.
Halozyme Therapeutics (HALO)
Therapeutic Halozyme (NASDAQ:HALO) is one of the most referenced companies on wallstreetbets. Biotech stock is also a fundamentally sound investment. In fact, the company is well above the break-even point and produces net gains on a GAAP basis. And, it is also growing rapidly with a 38% increase in revenue year over year. This growth is expected to continue this year and into 2024. The good news for investors is that there is still 50% upside beyond current prices for HALO(3) shares.
Western Alliance Bancorp (WAL)
Western Alliance Bancorp (NYSE:WALL) is the only security on this list considered high risk. Wallstreetbets investors believe that WAL stocks have a chance to produce returns for several reasons. After its collapse, there remains a value based on the target price for one. But they were more interested in the fact that “Big Short” investor Michael Burry took large positions in regional banks in the first quarter. This included 125,000 shares of Western Alliance Bancorp. One commenter correctly noted that we have no idea of his continued ownership, hedging strategy, or call and put options. Instead, we only know that he established a position.
Deposits continue to be the main concern in regional banking discussions. The WAL stock appears to be in good shape from this perspective. Deposits increased by $1.8 billion since the start of the quarter, with insured deposits accounting for 79% of all deposits. Only 68% of deposits were insured as of March 31.
Investors don’t hear much about caterpillar (NYSE:CAT) stock these days. No infrastructure bills are being considered to stimulate growth. Likewise, there is no overall growth boom at all that would catalyze the development and sales of heavy equipment. Instead, there is a sense of foreboding supported by fears of a recession. This would create big problems for CAT, as sales would almost certainly drop.
So the markets continue to see Caterpillar through this lens, looking for all signals back and forth. When the company released its latest results in late April, the signs were positive. Sales increased by 17%, margins increased from 13.7% to 17.2% and CAT exceeded previous forecasts.
The company was able not only to increase its sales volumes but also the prices of its products. This may seem counter-intuitive given the high cost of heavy equipment, but that’s what happened. CAT share prices have nonetheless fallen since the release due to lingering macro fears. Buy for the dividend income and stable price and ignore the overall fear.
Public cloud company Snowflake (NYSE:SNOW) and its stock had a very strong 2023. The stock price rose from $124 to $176. Much of this resurgence was driven by a rebound in tech stocks as Fed rate hikes wane.
As it stands, the Fed is likely to stop rate hikes later this year. This will result in a surge in tech stocks and a renewed focus on growth stocks rather than value stocks. This is why Snowflake should continue to receive positive reception in the market.
The company reported revenue of $2.066 billion in 2022. Sales are expected to reach $2.87 billion this year. An annual growth of 38% is close to the hypergrowth threshold of 40%. And Snowflake is expected to see sales of $3.91 billion in 2024. That’s about 36% growth. Yes, he still loses a lot of money. But he has a high-margin product and as soon as the losses show signs of abating, they will really increase.
At the date of publication, Alex Sirois did not hold (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.