In this article, we discuss the 10 trending technology stocks on Reddit.
Technology has helped reshape retail investing over the past few years and created a new generation of investors who are now one of the most dominant forces in the stock market. According to Andy Rachleff, the chief of automated investment firm Wealthfront, software tools have made it possible for even someone with $500 to open a brokerage account, something that previously required a fortune.
In May, a study by private equity firm CB Insights found that funding in retail tech had reached more than $28 billion at the end of the first quarter of 2021, nearly tripling in value when compared to the first quarter of 2020. On August 19, Robinhood, one of the applications favored by retail investors for stock trades, revealed in an earnings report that it expected a retail investor spending frenzy to take a breather between June and September. It also claimed that retail trading in crypto had helped double the revenue for the firm.
Most retail investors use online platforms like Reddit to exchange stock ideas. Some of the top trending stocks on Reddit presently include Alibaba Group Holding Limited (NYSE: BABA), Apple Inc. (NASDAQ: AAPL), NVIDIA Corporation (NASDAQ: NVDA), Tesla, Inc. (NASDAQ: TSLA), and Advanced Micro Devices, Inc. (NASDAQ: AMD), among others discussed in detail below. There is little doubt that retail investors, who are set to pour hundreds of billions of dollars into stocks this year, have transformed the equity market in the past few months.
The rise of fintech and crypto have also shaken the world of finance. 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 86 percentage points since March 2017. Between March 2017 and July 2021 our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by 86 percentage points (see the details here). 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.
Photo by Adam Nowakowski on Unsplash
Our Methodology
With this context in mind, here is our list of the 10 trending technology stocks on Reddit. They were picked keeping in mind the hype around the companies on Reddit forums like WallStreetBets.
The hedge fund sentiment around the stocks was gauged using data of 873 hedge funds tracked by Insider Monkey. The list is compiled according to the hedge fund holders in each stock.
The analyst ratings of the companies and their basic business fundamentals are also discussed to provide readers with some more context for their investment decisions.
Trending Technology Stocks on Reddit
10. Robinhood Markets, Inc. (NASDAQ: HOOD)
Number of Hedge Fund Holders: N/A
Robinhood Markets, Inc. (NASDAQ: HOOD) is placed tenth on our list of 10 trending technology stocks on Reddit. The firm owns and runs a financial services platform and operates from California.
On August 23, investment advisory Rosenblatt initiated coverage of Robinhood Markets, Inc. (NASDAQ: HOOD) stock with a Buy rating and a price target of $55. Sean Horgan, an analyst at the firm, issued the ratings update.
On September 1, the share price of Robinhood Markets, Inc. (NASDAQ: HOOD) soared over 6% after a Bloomberg report claiming that the firm was working on a new feature that would allow users to receive their pay two days early via a direct deposit under certain conditions.
9. MicroVision, Inc. (NASDAQ: MVIS)
Number of Hedge Fund Holders: 11
MicroVision, Inc. (NASDAQ: MVIS) is ranked ninth on our list of 10 trending technology stocks on Reddit. The firm makes and sells lidar sensors used in autonomous vehicles and is headquartered in Washington.
In earnings results for the second quarter, posted on August 4, MicroVision, Inc. (NASDAQ: MVIS) reported a revenue of over $0.75 million, up nearly 25% compared to the revenue over the same period last year.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in MicroVision, Inc. (NASDAQ: MVIS) with 2 million shares worth more than $34 million.
Along with Alibaba Group Holding Limited (NYSE: BABA), Apple Inc. (NASDAQ: AAPL), NVIDIA Corporation (NASDAQ: NVDA), Tesla, Inc. (NASDAQ: TSLA), and Advanced Micro Devices, Inc. (NASDAQ: AMD), MicroVision, Inc. (NASDAQ: MVIS) is among the top trending stocks on Reddit.
8. Virgin Galactic Holdings, Inc. (NYSE: SPCE)
Number of Hedge Fund Holders: 18
Virgin Galactic Holdings, Inc. (NYSE: SPCE) is a New Mexico-based integrated aerospace and human spaceflight company. It is placed eighth on our list of 10 trending technology stocks on Reddit.
On August 31, investment advisory Jefferies initiated coverage of Virgin Galactic Holdings, Inc. (NYSE: SPCE) stock with a Buy rating and a price target of $33, highlighting that the firm could increase revenue to nearly $1.7 billion by 2030.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Virgin Galactic Holdings, Inc. (NYSE: SPCE) with 4.5 million shares worth more than $209 million.
7. Skillz Inc. (NYSE: SKLZ)
Number of Hedge Fund Holders: 20
Skillz Inc. (NYSE: SKLZ) is a California-based company in the interactive home entertainment business. It is ranked seventh on our list of 10 trending technology stocks on Reddit.
On July 28, investment advisory RBC Capital initiated coverage of Skillz Inc. (NYSE: SKLZ) stock with a Sector Perform rating and a price target of $17, noting that the firm operated a differentiated mobile gaming platform in a growth market.
At the end of the second quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in Skillz Inc. (NYSE: SKLZ), down from 26 in the previous quarter worth $672 million.
Alibaba Group Holding Limited (NYSE: BABA), Apple Inc. (NASDAQ: AAPL), NVIDIA Corporation (NASDAQ: NVDA), Tesla, Inc. (NASDAQ: TSLA), and Advanced Micro Devices, Inc. (NASDAQ: AMD) are some of the trending stocks on Reddit, just like Skillz Inc. (NYSE: SKLZ).
6. Upstart Holdings, Inc. (NASDAQ: UPST)
Number of Hedge Fund Holders: 21
Upstart Holdings, Inc. (NASDAQ: UPST) is placed sixth on our list of 10 trending technology stocks on Reddit. The company owns and operates an artificial intelligence-based cloud platform for financial services. It is headquartered in California.
On September 6, investment advisory Atlantic Equities assumed coverage of Upstart Holdings, Inc. (NASDAQ: UPST) stock with an Overweight rating and a price target of $290. Earlier, Barclays had upgraded the stock to Overweight from Equal Weight with a target of $230.
Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Third Point is a leading shareholder in Upstart Holdings, Inc. (NASDAQ: UPST) with 13.3 million shares worth more than $1.6 billion.
In its Q2 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and Upstart Holdings, Inc. (NASDAQ: UPST) was one of them. Here is what the fund said:
“During the quarter, we purchased Upstart Holdings Inc. Upstart is an artificial intelligence (AI) and cloud-based lending platform. The company uses AI models to underwrite superior loans with lower interest rates, lower default rates, higher approval rates, and increased underwriting automation. Consumers can access Upstart-powered loans through its banking partners’ websites; however, most of its loans are underwritten on Upstart.com. Upstart has a fee-based revenue model and retains only a small portion of the loans, while the majority of the loans end up on the balance sheets of its partner banks or are sold into the capital markets. We believe Upstart’s technology is superior to the FICO score, which is ubiquitous within the consumer credit markets. With an excellent product and a large total addressable market, we believe that Upstart’s prospects are bright.”
5. Fastly, Inc. (NYSE: FSLY)
Number of Hedge Fund Holders: 24
Fastly, Inc. (NYSE: FSLY) is ranked fifth on our list of 10 trending technology stocks on Reddit. The firm is in the internet service and infrastructure business and is headquartered in California.
On August 9, investment advisory Raymond James reinstated coverage of Fastly, Inc. (NYSE: FSLY) stock with a Market Perform rating. Frank Louthan, an analyst at the advisory, issued the ratings update.
At the end of the second quarter of 2021, 24 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in Fastly, Inc. (NYSE: FSLY), down from 26 in the preceding quarter worth $1.3 billion.
4. Palantir Technologies Inc. (NYSE: PLTR)
Number of Hedge Fund Holders: 26
Palantir Technologies Inc. (NYSE: PLTR) is a Colorado-based digital analytics company that works closely with the intelligence communities. It is placed fourth on our list of 10 trending technology stocks on Reddit.
On August 13, investment advisory Wolfe Research maintained a Peer Perform rating on Palantir Technologies Inc. (NYSE: PLTR) stock and raised the price target to $25 from $20, appreciating the earnings beat of the firm in the second quarter.
At the end of the second quarter of 2021, 26 hedge funds in the database of Insider Monkey held stakes worth $1.3 billion in Palantir Technologies Inc. (NYSE: PLTR), down from 32 in the preceding quarter worth $1.1 billion.
In its Q4 2020 investor letter, Guardian Fund, an asset management firm, highlighted a few stocks andPalantir Technologies Inc. (NYSE: PLTR) was one of them. Here is what the fund said:
“In October, we bought a stake in Palantir. Earlier, in June, our concentrated Tech Fund, which has a mandate to also buy shares in the secondary market, bought shares of Palantir from insiders, before the direct listing. At the price we bought, the equity had much more upside than downside. Palantir is operating a software platform that functions as the digital infrastructure for data-driven operations and decision making. The software helps to structure and capture context in data of large corporations. Governments are increasingly realizing that they have to deal with serious data challenges and cyber risk. As most governments cannot attract the most talented software engineers, they need private enterprises such as Palantir to help them build solid infrastructure. Foundry, Palantir’s software for enterprises, is used by companiesto make safer cars and airplanes or to accelerate cancer research. The speed to bring new clients on board is improving and revenues will grow faster than expenses. Palantir has a long runway of growth ahead.”
3. Advanced Micro Devices, Inc. (NASDAQ: AMD)
Number of Hedge Fund Holders: 63
Advanced Micro Devices, Inc. (NASDAQ: AMD) is a California-based semiconductor manufacturer. It is ranked third on our list of 10 trending technology stocks on Reddit.
On July 29, investment advisory Argus maintained a Buy rating on Advanced Micro Devices, Inc. (NASDAQ: AMD) stock and raised the price target to $120 from $106, underlining that the stock price did not fully discount margin and revenue growth of the firm.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Advanced Micro Devices, Inc. (NASDAQ: AMD) with 28 million shares worth more than $2.6 billion.
In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Advanced Micro Devices, Inc. (NASDAQ: AMD) was one of them. Here is what the fund said:
“We also exited our positions in Advanced Micro Devices. Our investment campaign in Advanced Micro Devices (AMD) began in the second half of 2018, and we have seen a new management team reinvigorate the company’s product portfolio of microprocessors for PCs and servers, graphics processors, and video game consoles. These new, higher-margin products have helped the company partially close its margin gap with peers and capture share from market leader Intel. While we believe there is meaningful runway for further share gains and margin expansion, AMD has appreciated far beyond our mid-cap market cap mandate, and we exited our position.”
2. NVIDIA Corporation (NASDAQ: NVDA)
Number of Hedge Fund Holders: 86
NVIDIA Corporation (NASDAQ: NVDA) is placed second on our list of 10 trending technology stocks on Reddit. The firm operates as a visual computing company and is headquartered in California.
On August 20, investment advisory Benchmark assumed coverage of NVIDIA Corporation (NASDAQ: NVDA) stock with a Buy rating and a price target of $230, appreciating the “solid” quarterly earnings of the firm posted earlier.
At the end of the second quarter of 2021, 86 hedge funds in the database of Insider Monkey held stakes worth $9 billion in NVIDIA Corporation (NASDAQ: NVDA), up from 80 the preceding quarter worth $6 billion.
In its Q1 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and NVIDIA Corporation (NASDAQ: NVDA) was one of them. Here is what the fund said:
“NVIDIA Corp. is the dominant supplier of Graphics Processing Units (GPUs) worldwide. NVIDIA’s GPUs are at the intersection of a number of important computing trends including the movement to the Cloud, artificial intelligence, autonomous vehicles, edge computing, gaming, and more. We previously owned NVIDIA and sold it in the third quarter of 2020 as the price to value gap closed and our margin of safety was reduced. As with all our MVP companies, we continued to follow NVIDIA closely. Since that time, NVIDIA reported excellent results and its value has compounded rapidly. The technology selloff at the beginning of the year negatively affected the stock price while our estimate of NVIDIA’s value per share increased. This happy combination of events created a margin of safety and an opportunity to once again add NVIDIA to the portfolio.”
1. Alibaba Group Holding Limited (NYSE: BABA)
Number of Hedge Fund Holders: 146
Alibaba Group Holding Limited (NYSE: BABA) is ranked first on our list of 10 trending technology stocks on Reddit. The company operates as a diversified technology company with core interests in the ecommerce business. It is based in China.
On August 4, investment advisory KeyBanc maintained an Overweight rating on Alibaba Group Holding Limited (NYSE: BABA) stock but lowered the price target to $250 from $270, noting that regulation and investment in new initiatives posed risk to the growth of the firm in the near term.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Alibaba Group Holding Limited (NYSE: BABA) with 14 million shares worth more than $3.2 billion.
In its Q1 2021 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and Alibaba Group Holding Limited (NYSE: BABA) was one of them. Here is what the fund said:
“Alibaba also detracted from performance as the company continues to remain under regulatory scrutiny from both the Chinese State Administration for Market Regulation on antitrust concerns and the U.S. Securities and Exchange Commission on ADR listing requirements. Despite the regulatory overhang, we believe that Alibaba’s competitive positioning and growth outlook remains intact, even if the company must pay fines or modify some business practices. We viewed the current valuation at <20x next twelve month’s earnings as a compelling opportunity to add to our position. Alibaba is the second largest position in the Portfolio.”
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Disclosure. None. 10 Trending Technology Stocks on Reddit is originally published on Insider Monkey.
