BBIG’s high-risk, high-reward stocks are not for the faint of heart
Simply, vinco Companies (NASDAQ:BIG) is not for the faint-hearted. As we have seen over the past year, BBIG stock has made some big moves, both up and down.
This is partly due to its small size and low share price. Along with this, there are still unanswered questions about capital structure and corporate structure. The details could be positive, they could be negative. We simply won’t know until we do (when Vinco releases its next quarterly financial statements).
In addition to these two factors, some may point to its “meme stock” status, or its short interest (around 30% of its float was sold short) as something else that makes it highly volatile. Yet, whatever the reason, there’s no escaping the fact that you can’t approach the digital wallet company like you would with more blue chip investments.
That said, if you have the risk tolerance for it and are willing to dig into the details? You might want to think about it. Although far from a perfect situation, there is still great potential with its myriad stakes in start-up companies.
The latest with BBIG Stock
Since I wrote about it last month, admittedly not much has changed with the “story” behind Vinco. The company remains in the spinning process his Cryptyde crypto unit and non-fungible token (NFT).
Over the past month, the latest BBIG stock market rally has come and gone. From $2.50 per share to over $5 per share, it has since retreated and now stands at around $3.15 per share. As before, many questions remain unanswered about Vinco.
For example, questions about its impending merger with Global ZASH, and when it will close. The two companies, although sharing the same management teams, remain independent. This makes it difficult to assess its balance sheet (Vinco and ZASH are co-owners of many assets). There also remain unanswered questions about its past warrant issuances and their dilutive impact.
For many investors, a lack of progress and a few red flags can make this situation seem “impossible”. My opinion? I won’t be like the crowd, and hop in next time it’s in Reddit.
At the same time, I wouldn’t rule it out as a possible buy either. By placing capital in several high-risk but high-potential start-ups, success with any and/or all of them could result in another big move for the stock.
Opportunities and risks with Vinco
Again, BBIG stock is far from a perfect situation. Not just because of the lack of clarity in some of its financial and organizational details. With its major non-Cryptyde holdings, including the social media platform Lomotif and AdRizerthere is great risk with great opportunity.
Lomotif can be very similar to ICT Tac. The site also has its own video streaming platform. In fact, NBA legend Shaquille O’Neal recently hosted a program for the site. Another encouraging sign is its grand plans to grab a major share of India’s social media market. But it’s still far from certain that this ultimately gives TikTok a run for its money.
Yes, the situation with AdRizer, a digital advertising service provider, is much less murky. It is already well advanced in the monetization phase and is currently experiencing strong revenue growth. It remains to be seen whether this advertising platform will allow Vinco to better monetize its Lomotif platform. This was a major reason for its purchase by Vinco and ZASH’s ZVV Media Partners joint venture.
Along with this is the uncertainty behind the Cryptyde unit itself. There’s a lot of excitement surrounding this divestiture, which will result in one of the few NFT “pure games” out there with stocks. Yet, given how much more cautious the market has been lately about more speculative games? It may not end up becoming the “hot stock” that some are anticipating.
The takeaway with BBIG Stock
Get a “B” grade in my portfolio binder, I repeat that Vinco Ventures is not a stock for all types of investors. The more risk averse might want to skip it, given its high volatility.
Even those who are not afraid of risky games should not rush. I recommend that you dive into the details yourself before deciding if this is a speculative game worth adding to your portfolio.
When/if he makes another “moonward” move, anyone can guess. But the next time he makes a big announcement, it could well lead to another outsized move for BBIG shares.
As of the date of publication, neither Louis Navellier nor the member of the InvestorPlace research staff principally responsible for this article holds (directly or indirectly) any position in the securities mentioned in this article.
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