Cannabis stocks are lighting up the exchanges as the Reddit forum that recently boosted so-called “meme” shares now turns an eye on a fresh crop of companies, according to multiple reports.
Reuters said that one post on WallStreetBets, the Reddit forum in question, told users that shares of producers Tilray and Aphria had more room to rise. And so their shares did.
That post was liked by around 10,000 other users in just 12 hours, Reuters reported. And the publicity apparently fired up interest in the stocks, as shares in the two companies jumped by 21 percent and 10 percent, respectively.
With its 8 million participants, the WallStreetBets forum has become popular with traders at financial institutions, Reuters said. That interest comes after the frenzy last month over the buying up of beleaguered stocks — in part to bet against hedge fund “short sellers” who were figuring the price of shares would fall.
Reddit, which hosts various groups, has seen a surge in its valuation. In a blog post, the San Francisco company said Monday (Feb 8) that its valuation had been boosted to $6 billion, based on an additional $250 million in funding from existing and new investors.
“We decided that now was the right opportunity to make strategic investments in Reddit, including video, advertising, consumer products and expanding into international markets,” the company said. A Reddit spokeswoman told PYMNTS the latest round was led by Vy Capital.
According to Axios, the new valuation is a doubling of Reddit’s previous valuation of $3 billion.
Some observers say that the way GameStop, Dogecoin and other companies’ shares were sent skyward, at least in part by amateurs, amount to turning financial services into a game. Using apps such as Robinhood, amateurs went for an “us vs. them” mentality that skips financial education and real-world experience and goes for the thrill of battling hedge funds.
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