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7 Reddit stocks to watch for 2022

From biotech firms to electric vehicle makers, see what Reddit traders are buying.

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By

Kliment Dukovski

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Reddit traders became popular in January 2021 with the short squeeze of GameStop. You’ll recall some traders on the app bought shares of GME at its lows and saw the price jump more than 1,000% in one month. Once the story hit the news, one subreddit, WallStreetBets, grew from a couple of million members to more than 10 million in a few days.
And while the uproar faded, those and other Reddit stocks remained high interest through the year.
With some successful trades under their belts, more and more Reddit traders are sharing their strategies. We’ve picked seven popular Reddit stocks to watch based on a number of user mentions and upvotes. These are companies that are heavily shorted, undervalued or have a disruptive technology that will come into play in the years to come.

1. Tesla Inc. (TSLA)

Tesla is a US-based electric vehicle manufacturer. The company designs and manufactures electric cars, battery storage, solar panels, solar roof tiles and related products and services. In October 2021, Tesla’s market cap reached $1 trillion, which is the sixth company to do so in US history.
Because of that, it’s no wonder Tesla is the most-popular stock in the Reddit community — especially in the WallStreetBets subreddit. Tesla often has more than 5,000 upvotes and around 700 mentions in a 24-hour period, which is by far the highest of any other stock.

  • Market cap: $1.10 trillion (as of November 2021)
  • Recent stock price: $1,114
  • Dividend: N/A
  • 1-year return: 178%
  • 5-year return: 2,823%

2. Lucid Motors (LCID)

Lucid is another US-based electric vehicle manufacturer. Aside from electric cards, the company manufactures energy storage and original equipment for other companies. Unlike Tesla, which already has a robust production capacity, Lucid rolled out its first 20 cars to customers on Oct 30, 2021.
Despite that, Lucid is one of the more popular stocks on Reddit and the WSB subreddit. The company had around 150 mentions per every 24-hour period in October 2021, with more than 500 upvotes.

  • Market cap: $59 billion (as of November 2021)
  • Recent stock price: $37
  • Dividend: N/A
  • 1-year return: 285%
  • 5-year return: N/A

3. Progenity (PROG)

Progenity is a biotech company developing a test called Preecludia that rules out preeclampsia, a pregnancy-related blood pressure disorder. It also specializes in gastrointestinal drugs and oral biotherapies.
This was one of the top five stocks on Reddit based on mentions and upvotes. In October 2021, it had around 300 mentions on average in a 24-hour period with more than 2,800 upvotes. The reason for that is that some Reddit users consider this a short squeeze candidate with around 28% short interest.

  • Market cap: $511 million (as of November 2021)
  • Recent stock price: $3.50
  • Dividend: N/A
  • 1-year return: -17%
  • 5-year return: -73%

4. GameStop (GME)

The stock that made the WallStreetBets subreddit famous. GameStop is a US video game, consumer electronics and gaming merchandise retailer. It became popular in January 2021 when WSB members started buying and holding the stock to squeeze out short-sellers.
The logic behind the move was that there were more stocks being shorted — i.e. borrowed from brokers and sold with the hope of buying it back at a lower price — than there were GME stocks available. This resulted in a massive move of around 2,000% in January 2021, which made some traders rich and left others holding the bag as the price pulled back about 50% from its peak.

  • Market cap: $14.9 billion (as of November 2021)
  • Recent stock price: $183
  • Dividend: N/A
  • 1-year return: 1,761%
  • 5-year return: 865%

5. AMC Entertainment Holdings (AMC)

AMC is the largest movie theater chain in the world. This was one of the companies hit hard by the coronavirus pandemic, which forced it to borrow money to repay its debts and survive the year. Because movie theaters were closed during the lockdown, a lot of hedge funds shorted the stock.
This made it one of the candidates for a short squeeze by the WallStreetBets community. In January 2021, the squeeze happened and the stock rose almost 900%.

  • Market cap: $19 billion (as of November 2021)
  • Recent stock price: $35
  • Dividend: N/A
  • 1-year return: 1,624%
  • 5-year return: 18%

6. SoFi Technologies (SOFI)

SoFi Technologies is a US online personal finance company. It provides a variety of financial products, including student loan refinancing, mortgages, personal loans, credit cards, banking and investing in stocks and cryptocurrencies through both its mobile app and web application.
This is a company that many Redditors believe will disrupt the traditional banking system. SoFi consistently had an average of over 150 mentions per 24-hour period in October 2021 and more than 700 upvotes.

  • Market cap: $19 billion (as of November 2021)
  • Recent stock price: $35
  • Dividend: N/A
  • 1-year return: 1,667%
  • 5-year return: 21%

7. Corsair Gaming (CRSR)

Corsair is a US computer peripherals and hardware company. During the pandemic lockdown, the company saw a massive boost in sales as more people started building their own computers.
But even though the company is doing relatively well, its stock has over 30% short interest. This means that one-third of all floating shares are being shorted.
This is one of the reasons why it caught WallStreetBet’s eyes because once the shorts start covering, the stock could move high and fast.

  • Market cap: $2.35 billion (as of November 2021)
  • Recent stock price: $25
  • Dividend: N/A
  • 1-year return: 0.36%
  • 5-year return: N/A

Advantages and drawbacks of Reddit stocks

Following the Reddit crowd can sometimes be a good idea or it can backfire. Here are the pros and cons of Reddit stocks:

Pros

  • Potential to find high-performing companies
  • Redditors often get in before the stock makes its moves
  • You can learn about new companies and their potential

Cons

  • You could lose money, especially if you buy the stock late
  • Some Redditors have their own agenda for promoting stocks
  • Without your own due diligence, you could end up buying low-quality stocks

How to invest in Reddit stocks

Investing in Reddit stocks is simple but may require some research on your part. Here’s how to do it:

  1. Open a brokerage account if you don’t have one.
  2. Got to Reddit and WallStreetBets.
  3. Read the threads to find a stock you like.
  4. Research the stock to see if it makes sense for your portfolio.
  5. Enter the number of shares and the price you wish to buy.
  6. Submit your order.

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Bottom line

Investing in Reddit stocks is a double-edged sword: You could either make money or lose it. Make sure to do your own research before you commit your funds.
Related: Interested in what Reddit users are talking about right now? See “Today’s trending Reddit stocks.”

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