In this article, we will take a look at the 10 best Robinhood stocks to buy right now. You can skip our comprehensive analysis of these stocks and go directly to the 5 Best Robinhood Stocks to Buy Right Now.
Social media speculation and meme stock rallies have stoked market volatility in the past few months and left financial experts scratching their heads. Most of this disruption has been attributed to young investors banding together on applications like Robinhood to fuel a mind boggling surge or a horrific crash in the share price of one target. These investors bet on momentum plays, penny stocks, and sometimes just take a shot in the dark in the hopes of making a quick buck and are not bothered by the overall chain reaction to their actions.
Coinbase Global, Inc. (NASDAQ: COIN), a cryptocurrency exchange, was valued at over $86 billion when it went public last month. Even though several veteran investors, including Charlie Munger, had repeatedly warned that crypto stocks were overvalued, it seemed like the majority of the market decided not to pay heed to their advice. The share price of Coinbase Global, Inc. (NASDAQ: COIN) has tanked by close to half since then as a majority of young investors have lost patience in the stock as it is not offering them the quick road to riches it once promised. Coinbase Global, Inc. (NASDAQ: COIN) has an extremely strong business and analysts believe that the stock is expected to gain value in the long term. But most beginner investors impressed by the short-term gains pile into stocks like Coinbase Global, Inc. (NASDAQ: COIN) and other crypto plays in the hopes of quick gains.
GameStop Corp. (NYSE: GME), a video game retailer, witnessed explosive growth at the beginning of this year as retail investors on social networking platform Reddit led a triple digit percentage increase in value for the company. The share price of GameStop Corp. (NYSE: GME) then crashed to less than half of the all-time high within weeks, but still hovers above reasonable market estimates as it remains one of the most popular stocks on trading app Robinhood more than a few months after the Reddit saga.
Tesla, Inc. (NASDAQ: TSLA), the electric car manufacturing company owned by eccentric billionaire Elon Musk, has also joined young investors in the frenzy for cryptocurrency, alternative energy, and technology-related ‘get rich quick’ schemes. Tesla, Inc. (NASDAQ: TSLA) now accepts crypto payments for sales. It also remains the most popular stock on Robinhood and Musk has repeatedly engaged his predominantly young fan following on social media to either encourage or discourage investments in certain firms by using memes.
Tesla, Inc. (NASDAQ: TSLA) has gained 332% over the last 12 months. Tesla, Inc. (TSLA) has a lot of room to run, thanks to the rising demand of its EVs.
Young investors are flocking to stock trading apps. Robinhood gained more than 3 million users last year whose average age was around 30. It is nevertheless interesting to observe the stocks that these young investors are piling on in order to accurately assess their hopes and dreams for the future. After all, these young investors will take the place of the older generation in the market a few years from now. It would not be an exaggeration to say that fundamental market dynamics have changed.
Most of these young investors don't like the hedge fund industry giants, and sometimes, right so. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
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With this context in mind, here is our list of 10 best Robinhood stocks to buy right now.
Best Robinhood Stocks to Buy
10. AMC Entertainment Holdings, Inc. (NYSE: AMC)
Number of Hedge Fund Holders: 16
AMC Entertainment Holdings, Inc. (NYSE: AMC) is a Kansas-based company that operates movie theatres. It was founded in 1920 and is placed tenth on our list of 10 best Robinhood stocks to buy right now. AMC is the largest theatre company in the world. The firm controls close to 1,000 theatres and more than 10,000 movie screens globally. The 52-week range of AMC stock lies between $2-$20, with highs registered just before the pandemic shuttered economic activities. The firm has a market cap of more than $4.3 billion.
On April 5, AMC Entertainment Holdings, Inc. (NYSE: AMC) was upgraded to Buy from Neutral by investment advisory B Reilly with a price target of $13. Riley said that the company would benefit from post-pandemic return of movie audiences and had also negotiated pandemic headwinds well enough.
At the end of the fourth quarter of 2020, 16 hedge funds in the database of Insider Monkey held stakes worth $24 million in the firm, up from 12 the preceding quarter worth $7 million.
Mittleman Investment Management, in their Q4 2020 investor letter, said that AMC Entertainment Holdings, Inc. (NYSE: AMC) was a detractor for their portfolio in the fourth quarter of 2020. Here is what Mittleman Investment Management has to say about AMC Entertainment Holdings, Inc. in their letter:
"AMC Entertainment (AMC) was our only material loser in Q4, dropping from $4.71 to $2.12 (-55%). I planned on discussing here why it was worth at least the $10 per share that my recently reduced estimate of fair value claimed, but since then AMC raised more cash against their UK holdings and then the stock took off due to speculative players from reddit.com getting involved, so we sold it all around $14 during the last week of Jan. 2021. This was a modest profit for most clients, but a loss for some others, depending on when the account began, so check your statements to see where you came out. And yes, I recognize it as being a dose of good luck, which I heartily accept from the universe as it seemed somewhat lacking in the portfolio of late. After the sale of AMC in late January 2021, our exposure to the movie theater business is now exclusively in Canada via Cineplex, which has a 75% market share and much less leverage on its balance sheet.”
9. Sundial Growers Inc. (NASDAQ: SNDL)
Number of Hedge Fund Holders: 2
SNDL ranks 9th on our list of the best Robinhood stocks to buy. Sundial Growers Inc. (NASDAQ: SNDL) is a Calgary-based company that makes and sells cannabis-related products. Some of the products it offers include flowers, pre-rolls, and vapes. Sundial owns brands such as Top Leaf, Sundial Cannabis, Palmetto, and Grasslands. It is ranked ninth on our list of 10 best Robinhood stocks to buy right now and was founded in 2006. The 52-week price of the company stock lies between $0.1-$3.9, with the highs posted in March 2020. The stock price has been hovering around $1 over the past few weeks.
In March, Sundial Growers Inc. (NASDAQ: SNDL) partnered with Canadian private equity firm SunStream Bancorp in a deal worth $144 million to explore cannabis-related investment opportunities in international markets.
Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Millennium Management is a leading shareholder in the firm with 4.8 million shares worth more than $2.2 million.
8. NIO Inc. (NYSE: NIO)
Number of Hedge Fund Holders: 34
NIO ranks 8th on our list of the best Robinhood stocks to buy. NIO Inc. (NYSE: NIO) is a Shanghai-based carmaker founded in 2014. It is placed eighth on our list of 10 best Robinhood stocks to buy right now. The company is one of the largest electric vehicle manufacturers in the world. It markets electric sedans and SUVs for sale in China, the United States, the United Kingdom and Germany. It makes electric vehicle batteries as well. The 52-week price range of NIO stock is between $3-$66. After climbing to record highs just before the onset of the pandemic, the stock has been gaining in recent months as business reopens.
NIO is often ranked amongst the top EV players like Tesla, Inc. (NASDAQ: TSLA) because of its innovative technologies and strong business model.
On May 1, NIO Inc. (NYSE: NIO) reported that it had delivered more than 7,000 vehicles in April, a 125% increase compared to the same period last year but still a little below from the deliveries posted in March. The company has recently also warned of supply chain issues that are likely to affect production of cars for the next few weeks.
At the end of the fourth quarter of 2020, 34 hedge funds in the database of Insider Monkey held stakes worth $2.6 billion in NIO Inc. (NYSE: NIO), down from 35 in the preceding quarter worth $1.4 billion.
7. Aphria Inc. (NASDAQ: APHA)
Number of Hedge Fund Holders: 12
APHA ranks 7th on our list of the best Robinhood stocks to buy now. Aphria Inc. (NASDAQ: APHA) is a Canada-based company that grows and sells medicinal and recreational cannabis. It was founded in 2014 and is ranked seventh on our list of 10 best Robinhood stocks to buy right now. The company owns brands like Solei, RIFF, Good Supply, Aphria, P'tite Pof, and Broken Coast. The 52-week price range of Aphria stock lies $3-$40. The company posted an annual revenue of close to $400 million in 2019, a figure expected to rise to close to $500 million as the firm readies to release 2020 numbers.
On May 3, Aphria Inc. (NASDAQ: APHA) announced that it had completed a merger with Canadian rival Tilgray in a deal that would result in $81 million in annual pre-tax cost synergies within a year and a half, according to Tilgray.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in the firm with 1.7 million shares worth more than $12 million.
6. Zomedica Corp. (NYSE: ZOM)
Number of Hedge Fund Holders: 3
Zomedica Corp. (NYSE: ZOM) is a Michigan-based pharmaceutical firm founded in 2013. It is placed sixth on our list of 10 best Robinhood stocks to buy right now. The firm focuses on the development and marketing of drugs for pet animals. It has many drugs in the pipeline, including treatment for diarrhea in small dogs, a formula targeting hyperthyroidism in cats, as well as products for cancer detection in animals. The 52-week price range of Zomedica lies between $0.06-$2, with impressive performance at the height of the pandemic last year.
On March 16, Zomedica Corp. (NYSE: ZOM) stock gained more than 8% after the firm announced the first sale of a new diagnostic platform called TRUFORMA. The firm has already signed a distribution agreement for the new product with Miller Veterinary Supply.
Although not much famous like Tesla, Inc. (NASDAQ: TSLA), Coinbase Global, Inc. (NASDAQ: COIN) and GameStop Corp. (NYSE: GME), ZOM is quickly gaining popularity on Robinhood.
At the end of the fourth quarter of 2020, 3 hedge funds in the database of Insider Monkey held stakes worth $505,000 in the firm, down from 4 in the previous quarter worth $572,000.
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Disclosure: None. 10 Best Robinhood Stocks to Buy Right Now is originally published on Insider Monkey. The original article incorrectly stated that SNDL was purchasing Supreme Cannabis for C$435 million to fill holes in the Sundial product line.