MEME Stocks

Posted by

Buying stocks from companies that are hyped by online investment gurus will often leave you with losses. By the time you hear about the stock, it is usually too late. High volatility is common and if you get in after the peak, you will end up with a stock that may never recover. No one is perfect. If you invest long enough, you will get caught in one of these traps. The best way to avoid these stock traps is to know the support levels of any stock you want to invest in and have solid reasons for why the investment will increase in value. Stocks like Nano Dimension (NNDM) and Palantir (PLTR), that I bought this year, are down 30-40% while the rest of the stock market is at an all time high. Both stocks are under selling pressure from too many share offerings or executives cashing in stock options. Palantir has a large number of fans in the online investment guru world. They gloss over the fact that the founders of the company have millions of stock options that they need to sell. This is going to depress the share price for at least a year, even if this glorified database company begins to show a profit. One of the founders came out and said that if you don’t like the stock go buy something else. Not bad advice. NNDM is a company based in Israel that designs machines that can 3D print a circuit board. Even though they have a working product, they are still an early stage company. Meaning, they need lots of money to develop their product line. The shares outstanding have risen to 244.4 million, a 431% increase in its share count in just five months. The dilution means that the cash value of their stock is only $5.94 per share. As of this writing the stock is at $8.33. So, they need to have a great quarterly report and a positive forecast, or the stock could go even lower.

Leave a Reply