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To put it succinctly, Investors considering Vinco Ventures (NASDAQ:BBIG) stock have a lot to wade through. As the company pushes back its Cryptyde spinoff, shuffles its executive makeup, and takes on a new name there’s simply a lot to understand.
Source: shutterstock.com/Postmodern Studio
In my estimation, the most important thing to consider is simply that the company has pushed its Cryptyde spinoff back again. This was initially scheduled for Oct. 15, but then pushed to Oct. 22. That Oct. 22 date was again rescheduled, this time pushed back to Dec. 27.
For a factual blow by blow account I’d recommend reading Samuel O’Brient’s writeup on the series of shake-ups.
What I wouldn’t recommend is investing in BBIG stock.
Volatility is Unrivaled
There is essentially no way to understand Vinco Ventures from an investment perspective. I completely understand that the evolving world of NFTs and social media alternatives to TikTok is fast paced. In my opinion that’s where BBIG stock holds promise, if any. But the pace of change occurring at Vinco Ventures makes it too difficult to even follow, much less invest in confidently.
Simply take a look at its price chart over the past month and it’s plain to see that massive volatility is inherent. That’s fine, but following the catalysts underpinning that volatility is frankly, confusing. I think it’s fair to say that the latest delay of the Cryptyde spinoff should keep BBIG trending downward for a bit. Judging that catalyst seems clear. But other than that, it’s just very difficult to gauge much about the share price.
If Vinco Venture rises again it’ll be because of those two factors above; NFTs and short form media.
Vinco Ventures has been singled out for its NFT potential. Investors consider it to be a stock which can capitalize off of the excitement around NFTs. It clearly is gaining considerable attention for that angle.
Likewise, Vinco Ventures acquired Lomotif and its 31 million monthly users, a rival platform to TikTok. That’s another reason I assume investors are maintaining bullish sentiment around BBIG shares.
In my opinion those two factors keep BBIG interesting, but not worthy of capital. From where I sit, the company is simply throwing up more smoke and mirrors with its management changes.
Kicking the Can Down the Road
Vinco Ventures is repositioning its management teams across all of its companies. This also means that everything under the ZASH ecosystem, Vinco Ventures included, will hereafter be known as ZASH.
Ostensibly this will allow the company to better prepare for the Dec. 27 Cryptyde spinoff. However, that seems suspect. I simply see a company in massive flux that has realigned itself. Realignments don’t mean much.
Ask yourself how this managerial shuffle makes things better. Does it logically indicate that Vinco Ventures will be able to operate better or take advantage of the NFT craze? If it does, I don’t see how.
And does it change the fact that the firm has delayed the Cryptyde spinoff? Again, no.
That’s why I believe this is little more than a case of kicking the can down the road. I’m sure BBIG stock will continue to garner interest. It has short interest levels above 25% for one. So, it’s an obvious short squeeze play.
Further, NFTs aren’t going anywhere. The market will continue to try and understand how and if Vinco Ventures can capitalize on that.
What to Do With BBIG Stock
That said, I see the stock continuing to fall toward the $3 levels where it was months ago. It is only a play for the most risk-tolerant and the most averse to fundamentally sound investments.
It remains interesting as NFTs evolve. If it can show real results there, I’d absolutely consider investing in it. But the truth is that no one really knows whether the NFT market will amount to more than a flash in the pan.
On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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