In this article, we discuss the 5 trending stocks on Reddit. If you want to read our detailed analysis of these stocks, go directly to the 10 Trending Stocks on Reddit.
5. Novavax, Inc. (NASDAQ: NVAX)
Number of Hedge Fund Holders: 37
Novavax, Inc. (NASDAQ: NVAX) is ranked fifth on our list of 10 trending stocks on Reddit. The firm operates as a biotechnology company focused on vaccine development. It operates from Maryland.
On June 15, investment advisory Cantor Fitzgerald kept an Overweight rating on Novavax, Inc. (NASDAQ: NVAX) stock and raised the price target to $272 from $217, noting the progress of pipeline drugs for the firm.
At the end of the second quarter of 2021, 37 hedge funds in the database of Insider Monkey held stakes worth 1.1 billion in Novavax, Inc. (NASDAQ: NVAX), down from 38 in the previous quarter worth $1.2 billion.
4. Chewy, Inc. (NYSE: CHWY)
Number of Hedge Fund Holders: 43
Chewy, Inc. (NYSE: CHWY) is a Florida-based ecommerce company famous for retailing pet products. It is placed fourth on our list of 10 trending stocks on Reddit.
On August 4, investment advisory Credit Suisse initiated coverage of Chewy, Inc. (NYSE: CHWY) stock with an Outperform rating and a price target of $121. Katie Tryhane, an analyst at the firm, issued the ratings update.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Chewy, Inc. (NYSE: CHWY) with 1.4 million shares worth more than $115 million.
In its Q4 2020 investor letter, Nelson Capital Management, an asset management firm, highlighted a few stocks and Chewy, Inc. (NYSE: CHWY) was one of them. Here is what the fund said:
“One of our investment themes over the last several years has been the “humanization of pets,” which refers to the increasing amount of time and money that people are devoting to their animals. This theme has become even more evident during the pandemic, as many families and individuals have adopted pets while spending more time at home. Today, more than 85 million US households have pets. In 2015, roughly 7% of pet products in the U.S. were bought online. By 2019, that number had increased to 22%. Moreover, the pandemic has caused pet parents, new and experienced alike, to sign up for delivery of pet supplies in order to avoid trips to physical stores. 72% of pet owners made at least one online purchase for their pets in the past 12 months and 39% of those were subscription-based purchases.
Chewy (tkr: CHWY) is the largest pure-play pet “e-tailer” in the world, offering “the personalized service of a neighborhood pet store combined with the convenience and speed of e-commerce.” The company was founded in 2011 and was bought by PetSmart in 2017, for $3 billion. In June, 2019, Chewy went public. All of its sales are currently U.S.-based. The company has co-headquarters with one facility in Dania Beach, Florida and one in Boston, Massachusetts, and employs about 12,000 people. Chewy offers a selection of high-quality pet food, treats, supplies, and pet healthcare products.
In addition to one-time sales, Chewy is creating a recurring revenue model through its “autoship” program. This is essentially a subscription service for products that are sent at intervals specified by customers and includes such items as food and medicine. Customers are more profitable the longer they stay with the company, as their “lifetime value” grows. The company is organized around providing an exceptional customer experience. Chewy has 10 fulfillment centers scattered across the US, which enable cost-efficient overnight shipments to about 80% of the U.S. population and cost-efficient two-day shipments to nearly 100%. This allows Chewy to provide excellent service to the company’s more than 12.7 million active users.
Chewy’s ability operate profitably in the future hinges on two key variables: growing its customer base and more efficiently managing its fulfillment costs through automation of its fulfillment centers, thereby decreasing labor costs. Chewy has a smart, experienced management team and the company is expected to become profitable at the end of this fiscal year.”
3. Tesla, Inc. (NASDAQ: TSLA)
Number of Hedge Fund Holders: 60
Tesla, Inc. (NASDAQ: TSLA) is a California-based electric vehicle and clean energy firm. It is ranked third on our list of 10 trending stocks on Reddit.
On August 20, investment advisory Wells Fargo reiterated an Equal Weight rating on Tesla, Inc. (NASDAQ: TSLA) stock with a price target of $660, highlighting that a 2022 Bot launch plan by the firm “seemed optimistic”.
At the end of the second quarter of 2021, 60 hedge funds in the database of Insider Monkey held stakes worth $9 billion in Tesla, Inc. (NASDAQ: TSLA), down from 62 in the previous quarter worth $10 billion.
Here is what Baron Partners Fund has to say about Tesla, Inc. (NASDAQ: TSLA) in its Q1 2021 investor letter:
“Tesla, Inc. designs, manufactures, and sells fully electric vehicles, solar products, energy storage solutions, and battery cells. The stock fell during the quarter as a result of general market dynamics and a potential production slowdown due to parts shortages. A refreshed S/X and China Model Y ramp could also have a negative impact on margins in early 2021. We anticipate strong growth and improved margins driven by new production capacity, manufacturing efficiencies, localization of its manufacturing and supply chain, and maturation of Tesla’s full self-driving technology.”
2. Advanced Micro Devices, Inc. (NASDAQ: AMD)
Number of Hedge Fund Holders: 63
Advanced Micro Devices, Inc. (NASDAQ: AMD) is placed second on our list of 10 trending stocks on Reddit. The company makes and sells semiconductors and is headquartered in California.
On August 9, investment advisory BMO Capital upgraded Advanced Micro Devices, Inc. (NASDAQ: AMD) stock to Market Perform from Underperform and raised the price target to
$110 from $80, underlining that the shares looked more reasonably valued.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Advanced Micro Devices, Inc. (NASDAQ: AMD) with 28 million shares worth more than $2.6 billion.
In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Advanced Micro Devices, Inc. (NASDAQ: AMD) was one of them. Here is what the fund said:
“We also exited our positions in Advanced Micro Devices. Our investment campaign in Advanced Micro Devices (AMD) began in the second half of 2018, and we have seen a new management team reinvigorate the company’s product portfolio of microprocessors for PCs and servers, graphics processors, and video game consoles. These new, higher-margin products have helped the company partially close its margin gap with peers and capture share from market leader Intel. While we believe there is meaningful runway for further share gains and margin expansion, AMD has appreciated far beyond our mid-cap market cap mandate, and we exited our position.”
1. Apple Inc. (NASDAQ: AAPL)
Number of Hedge Fund Holders: 138
Apple Inc. (NASDAQ: AAPL) is ranked first on our list of 10 trending stocks on Reddit. The firm operates as a diversified technology company and is based in California.
On July 28, investment advisory Loop Capital maintained a Buy rating on Apple Inc. (NASDAQ: AAPL) stock and raised the price target to $165 from $150, noting that the firm had delivered a second straight quarter of material upside across the board.
At the end of the second quarter of 2021, 138 hedge funds in the database of Insider Monkey held stakes worth $145 billion in Apple Inc. (NASDAQ: AAPL), up from 127 in the preceding quarter worth $131 billion.
In its Q1 2021 investor letter, Distillate Capital, an asset management firm, highlighted a few stocks and Apple Inc. (NASDAQ: AAPL) was one of them. Here is what the fund said:
“Apple is an even more notable situation and one that highlights our free cash valuation methodology and bears further discussion given its Q3 ‘20 sale from our strategy. For an extended period, Apple was extraordinarily inexpensive on a free cash flow basis and was the largest position in our strategy, exceeding 5% of the portfolio.”
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