Meme stocks, once again, have taken center stage as investors flock to companies like Krispy Kreme, GoPro, and Beyond Meat. The trio saw significant gains on Wednesday before largely leveling off, amidst rising risk appetite.
Krispy Kreme, a doughnut maker, surged 4.6% higher, adding to its 26.7% gain from the previous day. Despite several years of falling profits and revenue, investors are optimistic about the company’s prospects. Wall Street expects it to post a loss for 2025, but the stock’s momentum remains.
GoPro, a camera maker, jumped 12.4% on Wednesday, following its 41% gain on Tuesday. The company last posted an annual profit in 2022 and has been struggling with declining revenue due to increased competition from smartphone cameras. Investors are betting that the stock will continue to rise.
Beyond Meat, a plant-based meat maker, also saw significant gains, although they were slightly lower than expected at 1.4%. The company has been struggling for years and has yet to notch an annual profit since going public in 2019. Despite this, investors remain optimistic about its prospects.
The surge of these meme stocks is partly due to their struggle against department store Kohl’s and online-based real estate company Opendoor Technologies, which fell sharply after surging over several days. However, experts caution that the gains are isolated and have yet to challenge the broader market’s calm tone.
Mark Hackett, chief market strategist at Nationwide, notes that while the activity reflects rising risk appetite, it remains isolated and has not yet challenged the broader market’s calm tone. The meme stock craze often fizzles out, but it occasionally reignites with sudden gains for companies like GameStop, BlackBerry, Bed, Bath & Beyond, and Chewy.
Investors who buy these stocks are betting on momentum continuing, but it can shift suddenly. As the stock market continues to push into record territory, investors remain vigilant, seeking bargains among beaten-down companies.
Source: https://apnews.com/article/meme-stocks-kohls-opendoor-technologies-9b61a6a555451d49483666d8a9f5ba43