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Is It Time To Sell Uranium Energy and 6 Other Meme Stocks Before They Hit $0?

Social media traders on communities such as Reddit’s r/WallStreetBets have had an amazing 2021. All of Wall Street stopped what it was doing to watch…

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This article was originally published by Investor Place

Social media traders on communities such as Reddit’s r/WallStreetBets have had an amazing 2021. All of Wall Street stopped what it was doing to watch the excitement in GameStop (NYSE:GME), BlackBerry (NYSE:BB) and other such meme stocks during their historic January short squeezes.

After Robinhood (NASDAQ:HOOD) temporarily suspended trading in GME stock and other meme names, however, it seemed like the party was over. GME stock, for example crashed from $400 to $40 at one point. However, the Reddit traders have had the last laugh. GameStop surged once again in May and this time, it has held onto its gains.

The WallStreetBets community remains a large and powerful force. While there isn’t quite the same buzz as there was in January — and admittedly some of the energy has moved to cryptocurrencies — meme stocks remain a potent force. However, not everything that gets popular on Reddit or has a high short interest will become the next GameStop. In fact, there are quite a few firms that have scarcely little going on to justify their current valuations.

These are seven meme stocks to sell now, while their share prices are still at respectable levels:

  • Vinco Ventures (NASDAQ:BBIG)
  • iBio (NYSEAMERICAN:IBIO)
  • Genius Brands (NASDAQ:GNUS)
  • XspresSpa Group (NASDAQ:XSPA)
  • Electrameccanica (NASDAQ:SOLO)
  • Uranium Energy (NYSEAMERICAN:UEC)
  • Sphere 3D (NASDAQ:ANY)

 

Meme Stocks to Sell: Vinco Ventures (BBIG)

Nyan CatSource: Polunina Mariia / Shutterstock.com

Vinco Ventures got one part of the social media playbook right: It has a great ticker symbol. BBIG practically just begs to be “memed.” The Reddit community around the stock is full of clever wordplay for the hot media firm.

As for the actual business? It’s much less promising. The company brings back a key figure from the MoviePass debacle to head up a TikTok rival. It also has an operation devoted to non-fungible tokens (NFTs). Perhaps there is a place for a TikTok clone in a world that is increasingly preoccupied about cybersecurity threats and the Chinese government’s behavior.

Still, given the relative small scale of the video business, investors should be highly skeptical of the stock here. Judging by the CEO’s past experience with MoviePass, there’s a good chance Vinco could burn through a load of investor funds before ignominiously ceasing operations.

 

iBio (IBIO)

A scientist in medical gear peers through a microscope.Source: Shutterstock

In 2020, IBIO stock spiked from 30 cents to as high as $6 per share. A previously little-known biotech firm, it generated a ton of attention around a potential Covid-19 vaccine. However, historically, iBio has enjoyed similar waves of positive attention from press releases about potential products for other pandemics. However, the company has never managed to convert that potential into real-world revenues or profits.

Covid-19 appears to be playing out the same way for iBio. Despite numerous seemingly positive developments, the company has little to show for it. The company generated just $3 million in revenues over the past 12 months. More surprisingly, it spent just $7 million on research and development costs over the past year. It seems unlikely that a leading Covid-19 vaccine will be developed on that sort of barebones budget.

While the peak of social media excitement around IBIO stock was back in 2020, trading volume has remained elevated this year. Traders are looking at the 7% short interest in shares and hoping it makes another run-up. However, it seems the market opportunity is passing for Covid-19 biotechs that don’t have a product on the market yet.

And don’t let the low share price fool you. IBIO has a sizable $250 million market capitalization given the company’s serial stock issuances. Shares will likely fall far lower as any residual interest in the company’s early stage Covid projects fade.

 

Meme Stocks to Sell: Genius Brands (GNUS)

GNUS stock: An image of two young girls looking at a tablet and smiling while an adult reads in the background.Source: Syda Productions/ShutterStock.com

Genius Brands is a fledgling media company attempted to carve out a niche for itself in the children’s entertainment space. The company seemed ideal for a meme stock, as it had a catchy name and is targeting an industry that resonates with a large group of traders.

That said, despite a blizzard of press releases over the past year, Genius has failed to transform any of its potential into financial results. As our Josh Enomoto recently put it, speculation might not save GNUS stock. The company’s (lack of) positive fundamentals is really starting to drag on the company.

In the company’s most recent quarter, it brought in just $1.1 million of revenues. Yes, you read that figure right. Meanwhile, it generated a GAAP loss of 27 cents per share on that quarter. That’s a rather sizable loss for a company whose stock trades south of $2. Genius can keep touting its new shows and celebrity deals, but with quarterly revenues this small, the company is light years away from becoming a media empire.

 

XpresSpa (XSPA)

Photo of a woman and man in white robes, laying down relaxing at a spaSource: UfaBizPhoto/ShutterStock.com

XpresSpa is a company focused on airport-based health and wellness centers. Prior to Covid-19, these could be categorized as day spas that helped travelers relax and pass the time between flights. That line of business became untenable due to the pandemic. So the company quickly pivoted to running Covid-19 testing centers out of its airport locations.

In theory, this made a lot of sense. In practice, however, demand for testing services at airports appears to be relatively low. Last quarter, the company generated just $9.1 million in revenues while losing $4.7 million overall. While the pandemic continues to drag on, it seems airport testing simply hasn’t become a large enough market to allow the company to reach profitability.

Meanwhile, it’s unclear on what timeline the company might be able to revert to its prior business model. It should also be noted that the company lost money before the pandemic as well. While momentum traders bid up XSPA stock as a Covid-19 play, the business has shown few signs of tangible success at any point.

A baffling thing about XpresSpa is that it recently announced a 15 million share stock buyback. In general, share buybacks are good for shareholders. However, typically companies actually generate profits and positive cash flow from operations before buying back their own stock.

XpresSpa, by contrast, has a long history of large operating losses. It has had to issue stock in the past to fund its operations. So it’s unclear why the company would spend precious capital now to repurchase shares rather than invest those funds into helping the business reach profitability. This seems like a gimmick to try to induce a short squeeze rather than a strategic financial decision. In any case, traders shouldn’t get on board with XSPA stock.

 

Meme Stocks to Sell: Electrameccanica (SOLO)

The Solo vehicle from Electra Meccanica Vehicles (SOLO) drives through VancouverSource: Luis War / Shutterstock.com

Electrameccanica was a hot electric vehicle (EV) stock early in 2021. Shares spiked from $3 to as high as $13 on excitement around the launch of its innovative one-seat EV. As the company notes, 80% of vehicle trips are with just one person, so the SOLO vehicle aims to provide everything a single person would need for their daily commute and driving around town.

The car is eye-catching and the concept is certainly different. However, it’s far from certain that much actual consumer demand exists for this product. While most vehicle trips may be without passengers, it’s still useful to have room for more people or cargo on occasion. And SOLO’s price point is too high for most people to buy one in addition to their usual larger vehicle.

Last quarter, the company produced just 25 SOLO vehicles. Its lifetime total of 78 vehicles produced is hardly more inspiring. It wasn’t hard to see the appeal of SOLO stock back when there were few other publicly traded EV stocks. Now, however, as the market is flooded with EV alternatives, a novelty like Electrameccanica has long since lost its appeal.

 

Uranium Energy (UEC)

Hand in long yellow glove holding a chunk of uranium materialSource: shutterstock.com/RHJPhtotoandilustration

Uranium has positively exploded in recent weeks. A popular WallStreetBets post, “Uranium: Start of a Commodity Supercycle” published two weeks ago has taken on viral fame.

That original post has some solid due diligence to it. The author explains the theory of a potential supply shortage in the uranium market for nuclear power plants. It also goes through the mechanics of how a trust that is buying physical uranium could trigger a short squeeze.

That’s all well and good, but it matters little to UEC stock. Uranium Energy is a company that intends to mine uranium in the United States. However, it has largely failed at this. It last generated commercial revenues from uranium production way back in 2015. Now, the company keeps running via stock offerings.

Management’s latest corporate presentation suggests that production may start up again at some point soon. That’s fine. But the company has gone many years now without generating revenues and didn’t produce an annual profit in a single year over the past decade. Now, though, thanks to the uranium short squeeze, UEC stock’s market capitalization has exploded to $750 million. That’s far too high for a company with such a spotty track record.

 

Meme Stocks to Sell: Sphere 3D (ANY)

a crypto mining rigSource: Mark Agnor / Shutterstock.com

Sphere3D is a small long-running technology company. Shares traded up to a split-adjusted $2,000 each at one point back in 2014. The company had merged together a variety of assets and aimed to become a leading virtualization software firm.

Sphere3D reached a peak of $76 million in revenues in 2016. Operations soon collapsed, however, with annual revenues dropping more than 90% since then. The stock price imploded along with the business. So, not surprisingly, Sphere3D is now pivoting.

To that end, Sphere3D is merging with a cryptocurrency mining firm, Gryphon Digital Mining. Gryphon aims to revolutionize the crypto-mining space through a focus on costs. It has secured lower-cost hydroelectric power which could give it a leg up on the competition. However, there are a ton of crypto mining firms out there now.

It’s much too early to say that Sphere 3D and Gryphon will be able to disrupt the existing leaders. And, given Sphere 3D’s unfortunate history, traders should look to take profits on the rare occasions when ANY stock rallies.

On the date of publication, Ian Bezek did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Ian Bezek has written more than 1,000 articles for InvestorPlace.com and Seeking Alpha. He also worked as a Junior Analyst for Kerrisdale Capital, a $300 million New York City-based hedge fund. You can reach him on Twitter at @irbezek.

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Author: Ian Bezek

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Energy & Critical Metals

The Ethical Investor: ESG moves, lessons from the energy crisis and JP Equities’ stock tips

The Ethical Investor is Stockhead’s weekly look at ESG moves on the ASX. This week’s special guest is JP Equity … Read More
The post The Ethical…

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The Ethical Investor is Stockhead’s weekly look at ESG moves on the ASX. This week’s special guest is JP Equity Partners’ director and partner, Nic Brownbill.

The world is in the grip of an ongoing global power crisis that has seen energy prices soaring by thousands of percentage points.

From China to Europe and now India, the cost of energy is surging drastically. The price of natural gas has even quadrupled in some parts of the world.

 

Source: IEA via Reuters

 

But economists are now warning this might be just the first of many power crunches the world will see as we transition into the new economy.

According to a research paper by CommBank’s analyst Vivek Dhar, there are two main root causes that led to the crisis — a strong demand recovery from the pandemic, and an acute shortage of two key power-producing fuels – natural gas and thermal coal.

As economies reopen, there is a sudden pent up demand from consumers which meant that factories were forced to switch on their production capacity at short notice. This was exacerbated by a colder than usual European autumn, as the continent potentially faces a more-freezing-than-usual winter season.

In China, the crisis mainly stemmed from an undersupply in local production of coals, according to Dhar, adding that coal supply has been hampered in China because of the government’s own environmental protection regulations.

So what can we learn from all this?

Dhar reckons that we are transitioning into the new economy too fast, too soon.

“What the recent energy crisis has shown is that the energy transition needs to be planned carefully,” Dhar wrote.

“This will mean significant investment in renewable generation, batteries, electricity grids and hydrogen.”

But he thinks the roll-out of a decarbonised grid and role of gas need to be clearly defined too.

“Under-investing in gas infrastructure relative to its role in coming years will only serve to make Europe’s energy market more vulnerable to prolonged gas shortages, and increase dependence on Russia.”

Like Europe, China’s decarbonisation ambition will need to be planned as well, Dhar said.

“If coal mines and coal power plants are closed before a renewable replacement is in place, power shortages in China could be an ongoing concern.”
 

What’s happening in Australia

Australians have chosen climate change as the top ESG priority, according to the latest survey conducted by global ESG consultant, SEC Newgate.

And more than half of the 1,000 Aussies surveyed said they were happy with the direction the government is taking on the environment.

ESG Rio
Source: Survey by SEC Newgate

 

Aussie respondents also nominated retailers Coles Group (ASX:COL) and Woolworths (ASX:WOW) as the top local companies when it came to doing well on ESG metrics.

These results should provide food for thought for PM Scott Morrison, who’s currently caught in a political wrangle with the Nationals in setting our 2050 climate goals.

The PM has told Liberal colleagues that he wants to bring a binding 2050 net zero commitment to the COP26 Summit in Glasgow next month, without having to upgrade Australia’s 2030 commitments.

Nationals Leader and also Deputy PM, Barnaby Joyce, said however that he was willing to back the 2050 targets only if funding for regional producers and farmers were made as part of the deal.
 

Special guest JP Equities’ Nic Brownbill shares his views and ESG stocks

Nic Brownbill, a partner at JP Equity, told Stockhead that decarbonisation is a mega global investment opportunity, one that JP Equity wants to be all in on.

How big is the potential for ESG investing?

“We see the whole decarbonisation theme as the next mega global investment opportunity. An estimated $41 trillion is required to decarbonise the planet. It’s going to be a bigger opportunity than the crypto market, because unlike cryptos, the carbon market is going to be mandated by governments, major asset managers and pension funds.”

Which segment of the ESG market do you see outperforming?

“Some companies will fall short in trying to make their carbon targets, so the balance will need to be met with carbon credits. I think carbon emissions will eventually be metricated, and the carbon offset market is going to be a way for major companies to offset their emissions.”

Would that investment opportunity catch on in Australia?

“I believe the Australian market hasn’t really caught on to the opportunity of this yet. But I think something will really start to emerge from the COP26 conference in November, where you’ll see a sustained mega theme starting to unfold in this country.

“I think we will start to see a complete emergence of Australian companies in the carbon space over the next few months and beyond.”

What are the ASX stocks that JP Equity likes in the carbon credit space?

One ASX stock that we’ve been watching very closely is  Fertoz (ASX:FTZ). They’re a leading North American fertiliser manufacturer that produces a unique low-emission rock phosphate product that increases crop yield by 15%.

“Importantly, it can generate significantly lower CO2 emissions in manufacturing compared with other commercial fertilisers.

“This presents a really significant opportunity because agriculture as a sector accounts for 24% of all human generated greenhouse emissions. Fertoz is one of the first movers in the carbon credit market, and since May this year has been issuing carbon offset credit certificates.

“It’s not a matter of if, but when disclosure of carbon emissions will become metricated. And as a result, Fertoz is getting some strong enquiries from other companies looking to offset their footprints by buying carbon credits.”

Any other ASX stocks you like in the ESG space?

“We’re also bullish on Mpower (ASX:MPR). The company is Australia’s leading specialist in renewable energy, battery storage and micro-grid business. It has a focus on five megawatt solar farms, and is in the process of creating an initial portfolio of 20 sites across Australia in the coming years.

“That gives them an aggregate capacity of around 100 megawatts, and an estimated value of more than $150 million. It’s now down to what the team can deliver in some of those projects to build up the portfolio.”

 

Notable ASX ESG-related news during the week

Rio Tinto (ASX:RIO)

The energy giant announced that it was targeting a 50% reduction in Scope 1 and 2 emissions by 2030, and a 15% reduction by 2025 from a 2018 baseline of 32.6Mt.

Around $7.5 billion in direct capital expenditure will be spent on decarbonising Rio Tinto’s assets from 2022 to 2030, including $0.5 billion per year from 2022 to 2024.

Strandline Resources (ASX:STA)

The company released its Sustainability Report for 2021, outlining its commitment to the United Nations Sustainable Development Goals (UNSDGs).

STA said it’s focused on managing development risks at its Coburn project in WA to safeguard workers and ensure environmental compliance.

Lithium Power (ASX:LPI)

The company has appointed global consulting firm Deloitte to ensure a robust ESG program at its Maricunga project in Chile.

Deloitte has been tasked to imbed sustainable protocols in LPI’s lithium extraction operations, and to establish ambitious standards for LPI to become a carbon neutral producer, while keeping high standards on the social aspects.

Jadar Resources (ASX:JDR)

The company also said it has completed its maiden Sustainability Plan, with strategies aligned to the UNSDGs.

 

The views, information, or opinions expressed in the interview in this article are solely those of the interviewee and do not represent the views of Stockhead.

Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.

The post The Ethical Investor: ESG moves, lessons from the energy crisis and JP Equities’ stock tips appeared first on Stockhead.




Author: Eddy Sunarto

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Energy & Critical Metals

You Can Now Buy A Flying Car That Looks Like A Star Wars Spacecraft

You Can Now Buy A Flying Car That Looks Like A Star Wars Spacecraft

Forget Elon Musk’s Tesla Cyberquad ATV because there’s a new form of transportation…

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You Can Now Buy A Flying Car That Looks Like A Star Wars Spacecraft

Forget Elon Musk’s Tesla Cyberquad ATV because there’s a new form of transportation for the offroad enthusiast now available, and it looks like something out of Star Wars. 

Sweden’s Jetson Aero has begun manufacturing a personal electric vertical take-off and landing (eVTOL) aircraft that will zip around the skies at 63 mph. 

The Jetson One eVTOL is an octocopter with four arms that produce 88 kW (118 horsepower) at full throttle. The pilot sits in an aluminum/carbon fiber frame and controls the craft via a throttle lever on the left, a joystick on the right, and a pair of pedals, likely controlling yaw.

According to vehicle car website Autoevolution, “the company [Jetson Aero] said that you can easily climb as high as 1,500 meters (4,921 feet) with Jetson One.” So far, videos only show the eVTOL moving at high rates of speed at low altitudes.  

Someone who weighs roughly 187 pounds can expect 15-20 minutes of flight time before the batteries need a recharge. 

New Atlas noted the eVTOL comes 50% built, and presumably, owners will have to assemble the rest. For that reason, the craft will likely fly under “experimental” where pilots don’t need a license to fly. 

As for price, a $22k deposit will give someone the right to reserve a build slot for 2023. There are only three left. Production in 2022, a total of 12, has already been secured from people worldwide, including a few in California. 

Personal eVTOLs appear to be the next big trend in transportation that will revolutionize how people (rich people) travel and commute or spend their leisure time. 

Tyler Durden
Sat, 10/23/2021 – 23:00

Author: Tyler Durden

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LG Companies to Pay $918M Over Chevy Bolt Fires, Resume Plans for IPO Before Year-End

LG Chem has come to an agreement with General Motors (NYSE: GM) to cover the cost of the Bolt battery
The post LG Companies to Pay $918M Over Chevy Bolt…

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LG Chem has come to an agreement with General Motors (NYSE: GM) to cover the cost of the Bolt battery recall, as the automaker is forced to recall all Bolt EVs ever produced.

According to a company statement seen by Bloomberg, LG Energy Solution and LG Electronics Inc— both of which are owned by LG Chem Ltd and manufactured electric vehicle batteries for GM, have agreed to pay the automaker a combined 1.1 trillion won, or $918 million in costs related to the Chevy Bolt recall.

LG Energy is expected to pay about 620 billion won after fires started in about a dozen Bolts, prompting GM to issue a recall spanning across more than 100,000 vehicles. LG Electronics, which was responsible for packaging the cells produced by LG Energy into modules that were placed in the batteries, has also agreed to compensate GM 480 billion won in costs.

Including previous costs related to the recall that were disclosed during the companies’ second-quarter earnings, both companies are now responsible for coming up with a total of 1.4 trillion won related to the recall. Following the news, LG Electronics slumped by nearly 1% before paring back losses, while LG Chem jumped by over 4%.

On Tuesday, LG Energy also announced that it will resume plans to launch an IPO before the end of the year, after putting the original plans on hold after GM announced the recall. LG Energy was one of the largest EV battery manufacturers in the world between January and August, and according to a report cited by the Korea Times, the company’s valuation sits at around 100 trillion won, or $83.58 billion, with expectations that it could raise nearly 10 trillion won during during the IPO.


Information for this briefing was found via Bloomberg and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

The post LG Companies to Pay $918M Over Chevy Bolt Fires, Resume Plans for IPO Before Year-End appeared first on the deep dive.


Author: Hermina Paull

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