Reddit stocks: what meme stocks are trending?

Reddit has become a hub for social-media driven traders and investors that have proven their ability to move the markets, injecting huge volatility into stocks like GameStop and AMC. But what stocks are grabbing attention on Reddit today?

Top Reddit stocks to watch

Below is a list of the top 10 most mentioned US stocks on the WallStreetBets thread on Reddit over the last 24 hours on January 27, 2023, according to data from Quiver Quantitative. Exchange-Traded Funds (ETFs) and other instruments have been excluded. 

 

1. Tesla

2. Intel

3. NVIDIA

4. AMD

5. Microsoft

6. Bed Bath & Beyond

7. C3.ai

8. Visa

9. Meta

10. Apple

 

US futures are losing ground today. The Dow Jones Industrial Average is flat while the S&P 500 is down 0.2%. The tech-heavy Nasdaq 100 is down 0.5% and being dragged lower by chipmakers following a poor update from Intel. Earnings season has got into full swing this week and while results have been better than anticipated, outlooks are coming in soft. Markets are also bracing for inflation data when personal consumption expenditures will be released at 0830 ET. This is the Federal Reserve’s preferred gauge of inflation so it will prove influential ahead of the central bank’s meeting next week. Economists forecast the core PCE price index will rise 0.3% month-on-month in December.

Intel is down 9.6% at $27.20 after issuing a grim outlook, sending shares to their lowest level in over three weeks. CEO Pat Gelsinger conceded the company underdelivered in the latest quarter. ‘We stumbled, right, we lost share, we lost momentum,’ Gelsinger said. That came as an inventory correction continued to plague the company, hurting sales, squeezing margins and weighing on cashflow. That led to a weaker than anticipated outlook. First quarter sales guidance of $10.5 billion to $11.5 billion was nowhere near the $13.9 billion forecast by analysts. If that happens, it will be the lowest quarterly revenue reported since 2010. Morgan Stanley said the ‘magnitude of the weaker guidance was quite surprising’ while Wells Fargo said the ‘key question (yet again) – is this the final capitulation in outlook?’ Brokers cut their target price on the stock after the results, including Bernstein to $20 from $23, JPMorgan to $28 from $32, Credit Suisse to $25 from $28, Cowen & Co to $26 from $31 and Wells Fargo to $26 from $32.

The update is also knocking other chipmakers. AMD is down 2.6% and is set to report quarterly results next Tuesday when all eyes will be on the outlook for 2023. Wall Street believes sales will fall for the first time since 2019 in the first quarter of this year, suggesting it too could struggle to impress with its guidance. NVIDIA, which will report results in late February, is down 2% and falling from its highest level since May 2022.

Visa is up 1.5% and Mastercard is trading marginally higher after the payments giants beat expectations in the latest quarter as payments volumes continued to grow, although at a slower pace as consumer spending stalls. Both companies saw volumes grow slower than anticipated, but the pair did deliver a beat when it came to earnings. Visa reported adjusted EPS of $2.18 compared to $1.81 the year before and this came in well above the $2.00 forecast. Mastercard reported adjusted EPS of $2.65 compared to $2.35 the year before and also came in ahead of the $2.58 forecast.

Notably, American Express reports earnings this morning and is up 0.7% before the bell. Volumes are forecast to grow 14% in the fourth quarter. Revenue is forecast to grow 17% from last year to $14.2 billion and EPS is expected to edge up 1.7% to $2.22. Management’s view of 2023 will be highly influential.

Chevron is up 0.6% and testing fresh all-time highs ahead of earnings out today. The oil giant has already provided a welcome surprise to shareholders after tripling its buyback programme to $75 billion and raising its dividend this week. Wall Street forecasts Chevron will report a 73% year-on-year rise in adjusted EPS to $4.43 in the fourth quarter. That puts the company on course to see annual adjusted earnings to come in over twice as high as we saw in 2021 and hit a new all-time record high. Free cashflow should remain strong at $8.9 billion even if it eases from what we saw in the third quarter. Earnings and cashflow are both anticipated to fall this year from the record levels we saw in 2022, although remain well above historic levels.

Bed Bath & Beyond is up 1.6% today and recovering some ground after plunging 22% yesterday, when the troubled homeware and baby product retailer edged closer toward bankruptcy after defaulting on its loans as it struggles to find the cash it needs to repay its debts. Creditors are now demanding immediate repayment and it simply doesn't have the money as sales continue to decline, losses swell, and it burns through cash. It needs to raise funds and quickly if it is to avoid collapse. A bankruptcy filing could be just around the corner and the clock is ticking. Existing lenders have not shown interest in providing fresh financing to back the company's turnaround, new lenders are unlikely to emerge, and raising equity also looks challenging. It could still sell assets, with the buybuyBABY brand thought to be attracting some interest, but Bed Bath & Beyond will be negotiating from a weak position and could struggle to secure the price tag it wants. It may be exploring all options, but they appear to be dwindling.

Tesla is down 0.4% and falling from six-week highs. Investors have warmed to the electric carmaker’s prospects for 2023, with CEO Elon Musk revealing it could sell up to 2 million vehicles this year. Demand remains buoyant and analysts believe that Tesla can survive and outperform during tougher times. Deutsche Bank said Tesla is not immune to a downturn this year but has more cost levers to pull than rivals, while margins will remain superior even if they take a knock.

Microsoft is down 0.3% and falling from five-week highs. The stock kicked off the Big Tech earnings season this week and, while it beat expectations in the latest quarter, it issued a weaker outlook as softer demand for cloud computing starts to bite. Tougher conditions have prompted Microsoft to cut 10,000 jobs while simultaneously investing billions into OpenAI in the hopes of finding new growth.

Apple shares are down 0.4% and dropping from six-week lows. Some positive news has emerged ahead of its quarterly results next week. The company is thought to have won its biggest quarterly market share in China on record at 24% in the last three months of 2022, according to Counterpoint Research data. It was the best performer in the period and was the second largest seller on an annualised basis for the first time. That will be welcomed considering Apple was expected to suffer from Covid-19 disruption during the period, both in terms of supply and demand.

Buzzfeed is up 18.7% and at its highest level since June 2022 after the Wall Street Journal reported it struck a $10 million deal with Meta last year to bring more content creators to Facebook and Instagram, with the digital media firm also reported to bee working on a deal that would see AI-driven chatbot ChatGPT produce content for the firm. Buzzfeed said it was not using ChatGPT, but the publicly available application programming interface run by the owner of the chatbot, OpenAI. ‘While we think AI could eventually help Buzzfeed generate more content at a lower cost (and drive higher engagement and advertising), timing and impact of their growing adoption of AI is unclear at this point,’ said analysts at Cowen & Co.

 

How to trade meme stocks

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