5 Best Meme Stock to Buy in December 2021

Meme stocks have been among the defining moments of the markets in 2021, where retail investors acted as a cohort and triggered a sell-off in several stocks. These stocks soared to astronomical highs even as analysts watched in disbelief.

But then, the laws of gravity caught up with meme stocks and they fell. As 2021 draws to a close, here are the five best meme stocks that you can buy for the next year.

1. Robinhood (NYSE: HOOD)

As ironic as it may sound, Robinhood, where many retail traders traded in meme stocks, itself became a meme stock. The stock had a dismal listing and fell below the IPO price. Robinhood joined the list of meme stocks shortly after its listing. However, it soon saw buying interest from retail as well as institutional investors. Cathie Wood of Ark invest was among the fund managers who put their weight behind Robinhood.

HOOD could be a good meme stock for 2022

Wall Street analysts have however been turning bearish on HOOD stock amid the slowing growth. However, the company is working on a long-term growth strategy. Robinhood is looking to add several new products to increase its wallet share from existing investors. It is working on offering IRA and has a waitlist of 1 million for its crypto wallet. The company might eventually add more cryptos as well as services like staking and lending on the platform. However, the company said that it would be careful and wait for more regulatory clarity.

After the crash, HOOD looks among the best meme stocks to buy for 2022. The addition of new products can drive the company’s growth even as the short-term outlook looks somewhat cloudy.

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2. Clover Health (NYSE: CLOV)

Clover Health is another meme stock that you can consider for 2022. The stock trades at a tiny fraction of its 52-week high of $28.85. However, at current prices, it looks like a stock worth betting on.

While it is currently making losses, like many other startup companies, it expects to be EBITDA positive by 2023. The company expects US Medicare Advantage spending to more than double between 2019 to 2025, and reach $590 billion. The expected increase in Medicare Advantage is positive for companies like CLOV.

It is the worst-performing company among those that merged with a SPAC sponsored by Chamath Palihapitiya. The stock trades at attractive valuations and is among the meme stocks that look good buys for 2022.

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3. Bakkt (NYSE: BKKT)

Bakkt is another classical meme stock. It went public through a reverse merger with VPC Impact Acquisition Holding SPAC. The stock crossed $50 at one point in time but now trades below the SPAC IPO price of $10. The company helps users unlock digital assets which include not only cryptos but NFTs, gift cards, and reward points. The company is backed by credible companies like Starbucks, Microsoft, as well as NYSE owner ICE (Intercontinental Exchange). It had forecast that its total addressable market would reach $5.1 trillion by 2025, which does not include international expansion.

BKKT could be a multibagger meme stock if digital assets gain traction

If digital assets gain traction and metaverse grows as rapidly as many are forecasting, BKKT could be among the multi-bagger meme stocks. The stock trades at a massive discount to its all-time highs and looks attractive at these prices.

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4. Nokia (NYSE: NOK)

Nokia is another meme stock that you can consider for 2022. Like fellow meme stocks, it has also come off its 2021 highs even as the drawdown is not as steep as some of the other meme stocks. The stock is a play on the 5G transition and looks attractive at these prices, especially for long-term investors.

The company has been trying to regain market share in the 5G market. Its efforts have been aided by the geopolitical environment where a lot of companies have been wary of inviting Chinese companies for the 5G telecom gear. Several countries have already barred Chinese companies from the 5G infrastructure and many others including India are expected to follow suit.

Nokia is targeting a 4G/5G market share between 25-27% globally, excluding China. In 2021, it is projecting comparable operating margins between 10-12% while it expects to be positive on the free cash flows also. If you are looking to buy a meme 5G stock, Nokia is one stock that should be on your radar.

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5. Sundial Growers (NYSE: SNDL)

Cannabis stocks have tumbled in 2021 and Sundial is no exception. Meanwhile, in typical meme fashion, the company has announced a stock buyback. A year back, SNDL was a struggling cannabis company and a buyback was simply out of question. Now, it’s a cash-rich company and is investing in other cannabis companies as well.

Sundial Growers released its third-quarter earnings earlier this month and reported cannabis revenues of CAD (Canadian dollars) 14.4 million in the quarter, which was 12% higher than the corresponding quarter in 2020. It posted an adjusted EBITDA of CAD 10.5 million.

SNDL is a meme stock in the cannabis industry

SNDL is a penny cannabis stock with a strong balance sheet. Cannabis stocks have been weak in 2021 as legalization hopes have faded. However, if we see movement on the legalization bill in the US, cannabis stocks should bounce back. Also, the investments that SNDL is making with the massive cash on its balance sheet would also pay off in the medium to long term.

Meanwhile, it is worth noting that meme stocks can be risky as compared to large-cap companies. The recent crash in these stocks is a testimony to the higher risk that they bring to the table. These stocks have been out of favor in the markets as the short squeeze game that WallStreetBets played seems to have lived its course. However, these five stocks seemed to have bottomed out after the massive crash looks like good buys for risk-tolerant investors.

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