Based on the latest headlines, figuring out which meme stocks to buy may be the last thing on your mind. Between a continued move to “risk-off,” due to economic uncertainties, along with tragic news related to high-profile meme stock Bed Bath & Beyond (NASDAQ:BBBY), meme mania continues to unravel.
However, while we aren’t likely to see a repeat of the 2021 frenzy anytime soon, that’s not to say that stocks in the meme category are a no-go right now (as long as you focus more on fundamentals and less on Reddit chatter). Top meme plays like AMC Entertainment (NYSE:AMC) and GameStop (NYSE:GME) continue to trade at valuations well above their underlying values.
As the speculative bubble that sent them “to the moon” continues to deflate, such names are at risk of further declines. Yet in the case of some of the secondary meme plays, following their big drops from their respective all-time highs, one can argue that investors can buy into them today, at a very favorable entry point.
For instance, with these three meme stocks to buy. It may take some time, but thanks to company-specific factors, each one has a shot of making a comeback.
It may not have been an AMC or GameStop-tier “meme king,” but when this trend first emerged, Blackberry (NYSE:BB) was initially one of the more popular meme stocks to buy.
Whether due to name recognition, or its appeal as a short-squeeze target, traders bid it up BB stock in January 2021. Trading at single-digit prices before the frenzy, it zoomed to as much as $28.77 per share. Unfortunately, shares in the company, best known for its now-discontinued mobile devices, have given back all of its meme gains.
However, this works in your favor. Per InvestorPlace’s Larry Ramer, there’s big potential with its current main lines of business, like its QNX automotive software unit.
While a deal to sell non-core patents recently fell through, it could eventually monetize this portfolio. Even if meme mania fails to return, success with its underlying businesses may make it a moonshot worth considering.
Express Inc. (EXPR)
One of the micro-cap meme stocks, Reddit traders who got in early with Express (NYSE:EXPR) in January 2021 saw stunning gains in a matter of days. The initial meme wave resulted in it going parabolic, skyrocketing around 14x in a matter of weeks.
Flash forward to now. EXPR stock is again back near pre-meme prices and not only because this investing trend has been on the wane. Soaring inflation, alongside growing concerns about a severe recession, have the market very pessimistic about the apparel retailer’s future prospects.
Based on Express’s latest fiscal results, sales growth has slowed down. Earnings have also seen a considerable drop. Add it its levered balance sheet, and fears of a total wipeout are well-founded.
Nevertheless, if it can ride out today’s challenges, or if an economic downturn proves to be milder than currently expected, this penny stock could easily make a triple-digit percentage rebound.
SNDL Inc. (SNDL)
If you can recall, at one point many pot stocks were popular meme stocks to buy. The meme crowd dived into names like SNDL Inc. (NASDAQ:SNDL) at the time, in large part due to high hopes that the “blue wave” seen during the 2020 U.S. elections would result in a fast-track for reforms to America’s marijuana laws.
However, this failed to pan out. In turn, investors soured on Canada-based cannabis purveyors like this one. So, with pot stocks out of favor, why consider it? On a split-adjusted basis, shares have fallen to pre-“blue wave” and pre-“meme wave” prices.
SNDL stock now trades at a discount to its tangible book value ($3.65 per share). Support for reforms is increasingly becoming a bi-partisan issue. Legalization may be only a few years away. Even if federal laws fail to change, other factors could enable it to become profitable.
On the date of publication, Thomas Niel 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.