A meme stock is a stock that gains immense popularity, a high trading volume, and strong social media interest, driven by online communities. There’s no real connection with the company fundamentals or performance. The original meme stocks, AMC Entertainment Holdings Inc. (NYSE: AMC) and GameStop Corp. (NYSE: GME), took the stock market by storm in 2021.
This week, meme traders have found more stocks to bet on. Besides the record-setting rally in the broader market this week, the speculative activity has caught investor interest. The better-than-expected tariff news brought a sigh of relief, and S&P closed at another record high yesterday. But it is time to move on from the GameStop mania and look at the new meme stocks of 2025.
Meme mania is back
The stocks are usually a target of short sellers or those who bet against the stock. With the rising momentum, other investors join and start buying to boost the price, which prompts others betting against the stock to buy more to cover losses. Often, a meme stock rally doesn’t last long.
In 2021, GameStop was struggling to survive, and an investor, “Roaring Kitty,” started the meme mania. The stock was trading for $5 and went as high as $400, but the craze eventually cooled down. However, the frenzy is reignited this week with two stocks being new targets. Shares of heavily shorted companies jumped in premarket trading on Wednesday as the recent meme stock revival extended to additional names.
In 2021, GameStop was struggling to survive, and an investor, “Roaring Kitty,” started the meme mania. The stock was trading for $5 and went as high as $400, but the craze eventually cooled down. However, the frenzy is reignited this week with two stocks being new targets. Shares of heavily shorted companies jumped in premarket trading on Wednesday as the recent meme stock revival extended to additional names.
Doughnut chain Krispy Kreme (Nasdaq: DNUT) has become the new meme stock. The stock surged 33%, adding to its 27% gain made on Tuesday. Recent data shows that the shares are heavily shorted. The stock is currently trading for $4.13, up 57% in the month and 40% in the past five days.
Up 27% in a day
Krispy Kreme stock is rising in the past two trading sessions and has jumped 13% since opening on July 23. Retail sentiment is bullish, taking the stock higher. A post on WallSteetBets read, “YOLO DNUT,” which describes an all-in, high-risk trading strategy. The stock also has a bullish sentiment on WallStreetBets.
The dizzying rally is also driven by a high call volume with more than 100,000 contracts trading, it is significantly higher than the average daily volume over the past four years. Reddit users were discussing new targets, with many promoting Krispy Kreme.
The surge shows how meme stocks gain relevance, and the dynamics remain alive. There is no positive news that justifies the stock’s rally. The stock could close at its highest since March this year. The movement in stock price this week is in stark contrast to the performance in the past few months. DNUT has lost 49% year-to-date and 54% in 12 months.
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