Sell Meme Stocks Now: Ditch These Seven as the Frenzy is Over

You may think a call to “sell meme stocks now” is an overreaction. After all, a fair number of meme names have performed well lately, suggesting a “renaissance” of sorts for this investing trend. In fact, some long-standing meme plays have bolted higher, thanks to rising optimism that macro concerns like high inflation and high-interest rates are entering the rearview mirror. Even meme plays with exposure to the artificial intelligence megatrend have performed very well for speculators lately.

However, it’s important to note that this has been a partial resurgence, not a full comeback. Plenty of past “meme kings” have continued to struggle. Not only that, the aforementioned meme stock rallies may prove fleeting. If “AI mania” takes a breather, or if investors who “bought on the rumor” of easing inflation and a rate hike pause from the Federal Reserve decide to “sell on the news,” stocks overall, meme stocks included, could be in for a reversal.

With this, consider it wise to heed my advice, and sell meme stocks now. In particular, these seven, all of which are at risk of pulling back from their respective current prices.

AMC Entertainment (AMC)

This month, AMC Entertainment (NYSE:AMC), one of the original “meme stocks” has experienced a modest lift in price, but overall, shares in the movie theater chain remain far below their 2021 meme frenzy highs. Worse yet, as I argued recently, AMC stock is likely to continue trending lower. While the question of “Is the meme stock frenzy over” remains up for debate, it’s clearly over for AMC. Based on data from Quiver Quantitative, there is now little chatter about the stock on Reddit’s r/wallstreetbets subreddit.

In addition, with few “apes” in its corner, AMC will continue to move toward a price more in line with fundamentals. In fact, in April, I argued AMC’s underlying value was under $1 per share, given its operating losses and past heavy shareholder dilution. There’s little suggesting the company’s fair value has climbed to anywhere near its current stock price ($5 per share) since then.

Blue Apron (APRN)

If you’re questioning my view that “sell meme stocks now” is a worthwhile position to take, you may be really questioning it when it comes to Blue Apron (NYSE:APRN).

Why? APRN moved 67.3% higher on June 9, following the meal kit company’s announced de-leveraging of its balance sheet (due to its shift to an asset-light business model). With this, betting on an APRN stock comeback seems like a profitable move. However, while bottom-fishing in APRN has been profitable is far, that may not be necessarily the case in the long term. To sustain operating losses as it works to become profitable, Blue Apron will likely need to utilize its at-the-market equity offering program, which gives it the ability to sell as much as $75 million worth of additional shares. Dilution from this could weigh on the stock, and minimize possible upside if turnaround efforts prove successful.

Clover Health (CLOV)

For some time, Clover Health (NASDAQ:CLOV) investors were bullish on the stock. In fact, at one time, it seemed that this digital-first provider of Medicare Advantage plans would “disrupt” the industry and become a major name in the space. However, that has failed to be the case. Revenue growth screeched to a halt in recent quarters. At the same time, Clover’s struggles to become profitable have persisted as well. Even as the company has brought its medical cost ratio (or MCR) to below 100%, gross margins still are not enough to cover overhead. Forecasts now call for Clover to stay in the red until at least 2025. The short-squeeze potential has also diminished significantly. Taking this into account, don’t expect a revival of the meme frenzy for CLOV stock.

Carvana (CVNA)

Carvana (NYSE:CVNA) is another meme stock that has performed well lately. For example, shares in the online used car retailer have been on a tear since May, more than tripling in price during this time frame.

Yet while the skeptics have been humbled by this stunning rebound of CVNA stock, their bearish views could still be ultimately proven correct. Despite recently providing investors with an upbeat outlook, analysts argue that improved results during this quarter represent a “one-time upside.”

That’s because the deflating of the used car bubble, which sank Carvana shares during 2022, may not yet be over. Fears that the company will fail to ride out the downturn may soon spike again. And if they do, the stock could cough back recent gains. Nowadays, ahead of a potential reversal, sell CVNA if you own it, and steer clear if you don’t own it.

GameStop (GME)

One can’t talk about the end of meme stock frenzy, without including a discussion of the most famous meme stock, GameStop (NYSE:GME). The mania surrounding shares in the video game retailer during early 2021 is what set this trend into motion in the first place.

Despite its meme pedigree, unless you bought it recently, holding GME stock with “diamond hands” has been unprofitable. Over the past two-and-a-half years, the video game retailer’s shares have given back the majority of its gains. GME has been moving up lately, as speculators wager GameStop Chairman Ryan Cohen’s next move will save the day.

However, the ultimate collapse of GameStop still appears likely. Barring a game-changing move that pays off quickly, I contend that GameStop remains on its way to becoming the “next Blockbuster,” forsaking the future by maximizing profits at its bricks-and-mortar stores, then going out of business when physical video games become fully obsolete.

Plug Power (PLUG)

In the past, Plug Power (NASDAQ:PLUG) has benefited from being a meme stock and a renewable energy stock. In fact, the green hydrogen company’s “green wave” bona fides are likely what has helped it avoid a full-on capitulation when the meme trend peaked.

The global decarbonization push is stronger than ever. Yet, it’s unclear whether this will fuel a PLUG stock comeback. If the company hits its ambitious financial targets for later this decade, this could be enough to send shares back toward past highs (around $75 per share). But as InvestorPlace’s Dana Blakenhorn recently argued, despite recent promising results, Plug Power has a long way to go before it demonstrates that it can become a profitable business.

With so much of its potential upside already priced in as a near-certainty, be sure to jettison PLUG if you decide to follow my advice, and sell meme stocks now.

Lordstown Motors (RIDE)

Lordstown Motors (NASDAQ:RIDE) is one of the best stocks to sell, with this would-be “EV contender” clearly in great distress.

In fact, the RIDE stock has fallen by more than 99% from its meme stock highs, yet it still could end up being a total loss for those buying, or even holding it today. It all has to do with the electric pickup truck maker’s severe cash crunch. Backer Foxconn (OTCMKTS:HNHPF) backed out of providing more financing. In turn, Lordstown has sued Foxconn, in an effort to secure the next round of capital. However, even with the lawsuit, it looks like the end of the road for RIDE. Struggling to obtain previously-committed capital, it is highly doubtful the company will obtain additional funding needed to sustain operations.

On the date of publication, Thomas Niel did not hold (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 Publishing Guidelines.

Thomas Niel, contributor for, has been writing single-stock analysis for web-based publications since 2016.

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