WallStreetBets Stock Tips September Week 3 Roundup

Reddit group WallStreetBets has become notorious for pumping several stocks. While some of the stocks which are popular in the group are the typical meme names with poor fundamentals, we can find some fundamentally sound companies as well.

While short squeezes, that Reddit traders have built their reputation for, can be a short-term price driver, they can’t impact the price action in the medium to long term. Here are the five stock tips from WallStreetBets that look good buys in the third week of September.

1. Beachbody (NYSE: BODY)

Beachbody went public this year through a SPAC (special purpose acquisition company) merger. The stock trades at a big discount to the SPAC IPO price of $10. It has seen some upwards momentum amid the pumping from WallStreetBets. Notably, the famous hedge fund Appaloosa which is led by David Tepper disclosed a position in BODY stock in its second-quarter 13F filings.

Why BODY is a good WallStreetBets stock to buy

Beachbody expects its revenues to rise at a CAGR of 30% between 2020-2025. The stock has been under a pressure amid the sell-off in growth names. Rival Peloton has also come off its highs. That said, company-specific factors, including a recall of products, have been weighing heavy on Peloton stock.

Wall Street analysts are also bullish on Beachbody stock and it has three buy and one hold ratings. The stock’s median target price of $11.25 implies an upside of 56.5% over yesterday’s closing prices. The stock’s street-high target price of $15 is a premium of 108% over current prices.

Beachbody’s valuations look quite reasonable after the fall. The stock is currently popular on WallStreetBets which could lead to more upside in the short term. That said, BODY is a fundamentally strong company with strong growth prospects, including in international markets. If you are looking at a WallStreetBets stock that looks undervalued, BODY looks among the best bets.

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2. Palantir (NYSE: PLTR)

Palantir is currently the most popular stock on WallStreetBets. The stock gained popularity among Reddit traders in the first quarter of 2021 also. Back then, the data analytics company had surged as high as $45. Arguably, WallStreetBets’ ability to pump stocks has come down drastically from the first quarter when the group triggered epic short squeezes in stocks like GameStop and AMC Entertainment.

Palantir is a WallStreetBets stock, but not a meme stock

Meanwhile, while Palantir is a popular WallStreetBets stock, it is not the typical meme stock. The stock has a positive long-term outlook considering the growing demand for data analytics. While the company expects revenues to rise at a CAGR of 30% till 2025, the actual growth could be much higher considering the number of new deals that it keeps on signing.

During the second quarter of 2021, the company closed 62 new deals valued above $1 million. Out of these 30 deals are above $5 million while 21 deals are above $10 million.

Palantir stock is looking bullish on the charts and trades above the short-term as well as the long-term moving averages. The stock has found strong support at the 200-day SMA (simple moving average) and currently trades above the price level. Its MACD (moving average convergence divergence) also gives a buy signal.

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3. Lucid Motors (NYSE: LCID)

Electric vehicle stocks have generally been popular on WallStreetBets. Lucid Motors that listed through a reverse merger with Churchill Capital IV (CCIV), is currently a popular WallStreetBets stock. That said, the stock looks like a good stock and there are several positive short-term triggers for the startup electric vehicle company.

Analysts are bullish on LCID stock

Most analysts have initiated coverage on Lucid Motors stock with a buy rating. Adam Jonas of Morgan Stanley has been a notable exception though. Earlier this week, Bank of America analyst John Murphy initiated coverage of the stock with a buy rating and a $30 target price. Murphy termed Lucid Motors stock as “the Tesla/Ferrari of new EV automakers”

“Our Buy rating on Lucid Group is predicated on our view that the company is one of the most legitimate among the universe of start-up electric vehicle (EV) automakers and also a relative competitive threat to the universe of incumbent automakers,” it said in its note.

Lucid Motors catalysts draw WallStreetBets attention

Lucid Motors is among those WallStreetBets stocks where Wall Street analysts and Reddit traders have convergent views. Later this month, Lucid Motors would showcase its assembly line which would be subsequently followed by the deliveries of its Air sedan. These catalysts could take the stock higher.

According to Murphy, “A better measure of LCID’s success than near-term financials while the company/industry is still in very early stages will be customer reservation trends (latest estimate of >10k as of June and Dream Edition fully reserved) and progress on start and ramp of production (target for SOP as of June had been 2H:21). Positive developments on both fronts will be necessary for the stock to work, which we generally anticipate.”

Overall, if you are looking at a good startup EV company, Lucid Motors looks among the best WallStreetBets stock to buy in September.

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4. IronNet (NYSE: IRNT)

IronNet also went public through a SPAC merger last month. The company recently released its earnings and maintained the guidance for the year. There has however been a frenzied rally in the stock and it has gained 131% over the last five trading sessions.

That said, while IronNet looks like a good WallStreetBets stock to buy considering the positive outlook for cybersecurity companies, the valuations look stretched at these prices. IRNT stock was trading sharply lower in US premarket trading today as the short squeeze seems to have lived its course.

Meanwhile, if the stock drops to near $30 price levels, it could be worth a look. The company expects its TAM (total addressable market) to rise to $41.1 billion by 2025 and has forecast its revenues to rise to $287.5 million in that year.

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5. Tilray (NYSE: TLRY)

Cannabis company Tilray is among the popular WallStreetBets stock. Reddit traders triggered a massive short squeeze in the stock earlier this year ahead of the merger with Aphria. However, the stock soon fell from the highs. Simply put, given the merger arbitrage between Tilray and Aphria shares, either TLRY had to some down or Aphria had to go down. The possibility of the latter happening was low, and Tilray eventually settled near the merger ratio as the merger date neared.

Tilray stock’s forecast is bullish

Analysts have a bullish forecast for TLRY stock and see a massive upside in TLRY stock. Its median target price of $16.4 is a premium of 37.5% over current prices. The stock’s highest target price of $27 is a premium of 125%. It trades very close to the street low target price of $12. TLRY stock however has a buy rating from only five analysts while 13 rate them as a hold. Only one analyst has a sell rating on the stock.

After Tilray’s merger with Aphria, Jefferies had issued a bullish note. “For us, when Aphria and Tilray combined, it was the perfect match. In Canada, a leading portfolio of brands, supported [by] an efficient cost structure. In Europe, the market is now picking up, while Tilray’s scale and Aphria’s unique German positioning make it perfectly suited to succeed,” it had said in the note.

Tilray cannabis stock catches WSB’s eye

In the past, cannabis stocks like Sundial Growers have also been popular on WallStreetBets. Meanwhile, Tilray has also made a foray into the US cannabis market through its investment in Medmen. Also, as it realizes the synergies from the Aphria merger, the stock could deliver good returns in the medium to long term.

All said TLRY looks among the best WallStreetBets stock to buy and bet on eventual marijuana legalization in the US.

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