Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

These 3 SPAC Stocks Could Be Huge Winners

By MarketBeat.com (Sean Sechler )Stock MarketsMar 17, 2021 09:38AM ET
www.investing.com/analysis/these-3-spac-stocks-could-be-huge-winners-200567803
These 3 SPAC Stocks Could Be Huge Winners
By MarketBeat.com (Sean Sechler )   |  Mar 17, 2021 09:38AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

Investing in Special Purpose Acquisition Companies, which are also known as SPACs, is a lot different than buying traditional equities. Since SPACs are shell companies set up by a group of investors with the sole purpose of finding a company to acquire and bring public, you are essentially betting on the management team’s success. That means when you buy a SPAC pre-merger, you aren’t getting a company that sells products or generates revenue. You never know what kind of company will ultimately be acquired, which means that there is a broad spectrum of outcomes that can occur.

SPACs had a banner year in 2020 but have cooled off recently thanks to a change in sentiment and a correction that left some investors reeling. Look no further than a stock like Clover Health (NASDAQ:CLOV) which is down 44% year-to-date and a good example of a post-merger SPAC that didn’t exactly work out the way many investors planned. With that said, investing in the right SPAC can potentially provide huge gains for your portfolio if you are willing to accept the risk. Given the volatile nature of these types of investments, buying SPAC stocks with a strong management team backing them or an intriguing acquisition target in their sights is critical. If you are intrigued with these “blank check companies”, keep reading on to learn about 3 SPAC stocks that could be huge winners below.

1. Churchill Capital Corp IV

This SPAC has taken investors on a wild ride in 2021, but could eventually become a big winner, particularly since a merger target has already been announced. Churchill Capital IV Corp (NYSE:CCIV) plans to bring Electric Vehicle start-up Lucid Motors public and will trade under the ticker “LCID” after the deal closes. Lucid Motors has often been compared to Tesla (NASDAQ:TSLA), which makes sense given the company’s CEO Peter Rawlinson was the former chief engineer for Tesla’s Model S vehicles.

In February, this stock surged up 157% to a high of $64.86 on speculation that Lucid Motors was the target company. However, the stock has pulled back dramatically since then and dropped over 50% from the February high. While this type of price action might scare some investors off, there’s enough to like about Lucid Motors and the company’s growth potential to warrant consideration at current price levels. We know the huge opportunity that EV companies have given the worldwide focus on sustainable energy, and the fact that Lucid’s vehicles feature a unique battery technology could make this one a huge winner. Keep an eye on this SPAC going forward, especially when the merger closes and when Lucid Motors debuts its luxury Air sedan later this year.

2. GS Acquisition Holdings Corp II

One of the big issues with buying SPACs is that when they are pre-merger, the stock price will typically move solely on rumors. That’s exactly the case with this SPAC GS Acquisition Holdings Corp II (NYSE:GSAH), which is a blank check company that was created by leading global investment banking firm Goldman Sachs (NYSE:GS). Back in February, the stock hit a high of $16.66 on a rumor that the company was close to making an acquisition. However, the merger has yet to take place and the stock price has retreated significantly.

While we don’t know which company is going into GS Acquisition Holdings Corp II as of yet, the company has stated it is focused on “Diversified Industrial, Healthcare, Technology, Media and Telecom, and Alternatives Asset Management sectors.” That’s a pretty broad array of acquisition targets, but SPAC investors should be intrigued with the fact that Goldman Sachs is behind this one. The company’s management team includes several former executives from Goldman Sachs, which should give investors extra confidence that a great company will be acquired at some point. The stock price is at an attractive entry point at this time too, which is very important when buying SPACs.

3. Fintech Acquisition Corp V

If you are looking for another SPAC that has announced a very intriguing company that it will be bringing public, Betsy Cohen’s Fintech Acquisition Corp V (NASDAQ:FTCV) fits the bill. The stock rallied over 42% during Tuesday’s trading session after the company announced it will be bringing online investment platform eToro public. eToro expects a valuation of $10.4 billion and is a direct rival of Robinhood, although at this time eToro does not offer stock trading in the United States.

There are several noteworthy things about eToro. First, the company is benefitting from the boom in commission-free trading and has amassed a user base of over 20 million, including 1.2 million new registered users last January. In 2020, the company reported gross revenues of $605 million, which represented a 147% year-over-year increase. eToro also is one of the only investment platforms that allow its customers to hold both traditional assets like stocks and bonds along with newer assets such as cryptocurrency. Finally, it’s worth mentioning that eToro has received approval for a broker-dealer license and could launch in the U.S. market later this year.

Original Post

These 3 SPAC Stocks Could Be Huge Winners
 

Related Articles

These 3 SPAC Stocks Could Be Huge Winners

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (4)
Ed Georges
Ed Georges Apr 07, 2021 10:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
eToro for sure is the biggest one. With 1B cash in bank and 2 digits growth, not bad to enter at this low price
Lawrenti Berija
Lawrenti Berija Mar 18, 2021 1:04AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
...eToro also is one of the only investment platforms that allow its customers to hold both traditional assets like stocks and bonds along with newer assets such as cryptocurrency... sure. there is no other
TL Chan
TL Chan Mar 18, 2021 12:23AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Lucid is being sued.
Robert Feifer
Robert Feifer Mar 17, 2021 1:26PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
boom! spot on
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email