When individuals think about Reddit stocks, it's not surprising that GameStop (NYSE:GME) and AMC Entertainment (NYSE:AMC) come to mind. These two stocks were the poster children of the “meme stock" movement in 2021. And they weren't alone. There are a number of speculative stocks that are trending in the social media forum.
The Reddit community, however, is interested in more than low-priced stocks. To be clear, penny stocks still draw a lot of interest from the Reddit crowd. But this is a diverse group of investors. In fact, many of the trending Reddit stocks are companies that are in the portfolio of many retail and institutional investors.
That's why it's worth paying attention to the stocks that are popular with Reddit investors. That's the purpose of this presentation. Here are seven stocks that appear to be sound investment choices for 2023. All of these stocks currently have a consensus analysts rating of Hold or better.
Quick Links
- Tesla
- Nio
- Nvidia
- Taiwan Semiconductor Manufacturing
- Chevron
- Eli Lilly
- Lockheed Martin
#1 - Tesla (NASDAQ:TSLA)
Tesla (NASDAQ: TSLA) leads our list of Reddit stocks to buy in 2023. The company and its stock have been in the news a lot in 2022, heavily due to a stock split that took place in August. Most headlines stirred due to founder and CEO Elon Musk’s purchase of Twitter. Musk notably sold off TSLA shares to help finance the purchase.
Some rumblings accuse the visionary billionaire of having too much on his plate. If that’s the case, it’s hard to see that in the company’s earnings reports. The company continues to grow revenue and earnings on a year-over-year basis. Both are set to grow at rates above 30% and 40%, respectively, for the next five years.
Electric vehicles may not be the mainstream choice, but it certainly seems as if critical mass continues to build in this space. If that’s the case, Tesla should have a large seat, if not the largest seat, at that table.
About Tesla
Tesla, Inc designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally. The company operates in two segments, Automotive, and Energy Generation and Storage. The Automotive segment offers electric vehicles, as well as sells automotive regulatory credits; and non-warranty after-sales vehicle, used vehicles, body shop and parts, supercharging, retail merchandise, and vehicle insurance services.
Read More - Current Price
- $342.03
- Consensus Rating
- Hold
- Ratings Breakdown
- 14 Buy Ratings, 16 Hold Ratings, 9 Sell Ratings.
- Consensus Price Target
- $230.18 (32.7% Downside)
#2 - Nio (NYSE:NIO)
If you haven’t written off Chinese stocks, you may want to consider Nio (NYSE: NIO), another Reddit stock. Not too long ago, Nio was a penny stock and the electric car maker appeared destined for bankruptcy. The company received a lifeline from the Chinese government and they’ve made the most of it.
As of this writing, Nio has six EV models on the market and the company has forecasted five additional models coming in 2023. Nio already has addressed one of the key pain points for consumers (while lowering the costs of its EVs) with its battery-as-a-service (BaaS) program. This allows it to capture a significant percentage of the Chinese market, primarily in the premium segment.
Despite the COVID-19 lockdowns in China, Nio continues to deliver vehicles and has expanded into Norway. For now, that’s the extent of the company’s expansion, but Nio may eventually have at least some exposure to North America.
The real growth in NIO stock (as with the EV market in general) may still be several years away, but the stock looks attractive for patient investors.
About NIO
NIO Inc designs, manufactures, and sells electric vehicles in the People's Republic of China. The company is also involved in the manufacture of e-powertrain, battery packs, and components; and racing management, technology development, and sales and after-sales management activities. In addition, it offers power solutions for battery charging needs; and other value-added services.
Read More - Current Price
- $4.65
- Consensus Rating
- Hold
- Ratings Breakdown
- 3 Buy Ratings, 8 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $5.91 (27.1% Upside)
#3 - Nvidia (NASDAQ:NVDA)
Nvidia (NASDAQ: NVDA) shined brighter than most semiconductor stocks in 2021. But the shine has come off off the sector and NVDA stock has shot down 42% in 2022. The company faces some headwinds in the form of a chips restriction on sales to China and as well as demand destruction that comes from part of the Federal Reserve’s interest rate hikes to curb inflation.
The stock has bounced off the 52-week low it hit in October. Nvidia's next-generation chips may have contributed to the company’s slowdown in revenue. This plays into the bullish argument for Nvidia. In Nvidia’s case, the company’s chips remain essential for companies like data centers, a sector where growth remains strong, as well as artificial intelligence applications.
Many high-growth sectors of the economy consider semiconductor chips as essential to the economy. If customers plan to ramp up buying, investors may want to take a closer look.
About NVIDIA
NVIDIA Corporation provides graphics and compute and networking solutions in the United States, Taiwan, China, Hong Kong, and internationally. The Graphics segment offers GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU or vGPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems; and Omniverse software for building and operating metaverse and 3D internet applications.
Read More - Current Price
- $145.89
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 40 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $154.63 (6.0% Upside)
#4 - Taiwan Semiconductor Manufacturing (NYSE:TSM)
Buying stocks that Warren Buffett buys may not be the right reason to buy a stock, but it's likely not the wrong reason, either. That’s the reason that Taiwan Semiconductor Manufacturing (NYSE: TSM) makes this list of Reddit stocks to buy in 2023, but it’s not the only reason.
Taiwan Semiconductor doesn’t make its own chips. Rather, as its name suggests, it facilitates making chips for other companies. Two of the company’s notable clients include Nvidia Co. (NASDAQ: NVDA) and Qualcomm (NASDAQ: QCOM). The latter provides chips for Apple (NASDAQ: AAPL).
All that said, the stock has one significant risk. Some U.S. defense experts have signaled that China will invade Taiwan sometime in 2023. This makes it all the more reason for the company to complete construction on the $12 billion semiconductor plant it is building in Arizona. Not only does it diversify the company’s supply chain, it also allows it to take advantage of the U.S. Chips Act.
According to analysts tracked by MarketBeat, TSM stock has a consensus stock price that gives it an upside of over 45%.
About Taiwan Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing Company Limited, together with its subsidiaries, manufactures, packages, tests, and sells integrated circuits and other semiconductor devices in Taiwan, China, Europe, the Middle East, Africa, Japan, the United States, and internationally. It provides a range of wafer fabrication processes, including processes to manufacture complementary metal- oxide-semiconductor (CMOS) logic, mixed-signal, radio frequency, embedded memory, bipolar CMOS mixed-signal, and others.
Read More - Current Price
- $188.41
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 4 Buy Ratings, 1 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $214.00 (13.6% Upside)
#5 - Chevron (NYSE:CVX)
Chevron Co. (NYSE: CVX) has been one of the big winners among energy in 2022. CVX stock is up a whopping 59% for the year. When you factor in a dividend that currently yields just over 3%, shareholders have had a great run.
Some, however, believe that party and the windfall profits it brought may come to an end for traditional oil and gas companies. Supply and demand will always play a big role in the share prices of oil companies. There is some evidence that demand will wane if the U.S. economy continues to weaken.
Another story continues to emerge for many of the leading names in the “big oil” sector, Chevron included. Many of these companies are already entrenched in the renewable energy space. One area that benefits CVX shareholders in particular has to do with the company’s leadership in the liquefied natural gas space.
As oil costs rise, the United States and the world, particularly Europe, needs natural gas.
About Chevron
Chevron Corporation, through its subsidiaries, engages in the integrated energy and chemicals operations in the United States and internationally. The company operates in two segments, Upstream and Downstream. The Upstream segment is involved in the exploration, development, production, and transportation of crude oil and natural gas; processing, liquefaction, transportation, and regasification of liquefied natural gas; transportation of crude oil through pipelines; transportation, storage, and marketing of natural gas; and carbon capture and storage, as well as a gas-to-liquids plant.
Read More - Current Price
- $161.30
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 13 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $174.93 (8.5% Upside)
#6 - Eli Lilly (NYSE:LLY)
An effective treatment for Alzheimer’s disease remains elusive but Eli Lilly (NYSE: LLY) received a breakthrough therapy designation from the FDA in 2021 for its leading Alzheimer’s drug candidate, Donanemab, which is designed to reduce the buildup of beta-amyloid plaque.
The company expects to hear back from the FDA early in 2023. If the FDA gives the company the go-ahead, Eli Lilly may accelerate its timing for bringing Donanemab to market and LLY stock will likely get a bounce on the news as well.
But that’s just one reason to consider LLY stock. The company has many commercially available drugs including its diabetes drug, Mounjaro, which just received FDA approval in October 2022. Eli Lilly continues to add to its treatment pipeline for cancer, immunology, diabetes, pain and neurodegeneration.
About Eli Lilly and Company
Eli Lilly and Company discovers, develops, and markets human pharmaceuticals worldwide. The company offers Basaglar, Humalog, Humalog Mix 75/25, Humalog U-100, Humalog U-200, Humalog Mix 50/50, insulin lispro, insulin lispro protamine, insulin lispro mix 75/25, Humulin, Humulin 70/30, Humulin N, Humulin R, and Humulin U-500 for diabetes; Jardiance, Mounjaro, and Trulicity for type 2 diabetes; and Zepbound for obesity.
Read More - Current Price
- $753.41
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 17 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $1,007.94 (33.8% Upside)
#7 - Lockheed Martin (NYSE:LMT)
Unlike many stocks on this list, Lockheed Martin (NYSE: LMT) stock has gone up 32% in 2022. The defense contractor has benefited from the geopolitical instability caused by Russia’s invasion of and ongoing war with Ukraine. The company’s weapons system have been front and center in what has helped the Ukranians defend themselves.
The recent midterm elections produced a divided Congress, which should bolster shares of Lockheed Martin which has a wide moat as a defense contractor.
LMT stock is near the top of its 52-week range and the analyst consensus price target of analysts suggests the stock could go lower. Nestled among a bunch of revised price targets since the company reported earnings in October include several analysts who see the stock moving about 15% higher than its current price. Even if it doesn’t, Lockheed Martin offers an attractive dividend that has increased for 19 years and currently pays $11.20 per share on an annual basis.
About Lockheed Martin
Lockheed Martin Corporation, a security and aerospace company, engages in the research, design, development, manufacture, integration, and sustainment of technology systems, products, and services worldwide. The company operates through Aeronautics, Missiles and Fire Control, Rotary and Mission Systems, and Space segments.
Read More - Current Price
- $534.89
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 9 Buy Ratings, 4 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $611.00 (14.2% Upside)
The only constant in the stock market is that it can make fools out of “experts." That's why anyone who says they know what 2023 will shape up to be is not telling you the truth.
Interest rates and inflation are likely to play a significant role in the performance of stocks in 2023. And as Russia's invasion of Ukraine reminds investors, there are always black swan events that can foil the best investment strategies.
This uncertainty is why communities, even online ones, matter a lot. The Reddit forum is a place for investors to share investment ideas. There's strength in numbers. The stocks in this presentation are just a sampling of the stocks that Reddit members are discussing each and every day.
As part of your MarketBeat subscription you have access to a list of trending Reddit stocks that you can screen based on specific criteria such as market cap, sector, and media sentiment. It's another example of the kind of research tools that make MarketBeat the only destination you need for your stock news.
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