In recent months, investors have witnessed several short squeezes triggered by the Reddit investment community WallStreetBets. But because some overheated Reddit plays have cooled off significantly, we think investors should avoid Blink Charging (BLNK), Ideanomics ( IDEX (NYSE:IEX)), Zomedica (ZOM), and AYRO Inc. (AYRO) in the near-term. These names look highly overvalued and could suffer further pullbacks. Read on.Following Reddit’s online forum r/WallStreetBets’ (WSB) huge success in squeezing short sellers out of their positions in struggling GameStop (NYSE:GME) and significantly gaining from it earlier this year, the market has seen a wave of short squeezes.
However, the fundamental weaknesses in most of the Reddit plays have caused their short squeeze to be short lived, and the stocks declined quickly after hitting their highs.
Considering the clear disconnect between the fundamentals and price levels of Reddit favorites Blink Charging Co. (NASDAQ:BLNK), Ideanomics Inc. (IDEX), Zomedica Corp. (ZOM), and AYRO Inc. (AYRO), we think it’s wise to avoid them now. These stocks have witnessed significant price declines lately and are susceptible to further price retreats.