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Vinco Ventures Stock: Under Short-Squeeze Alert

BBIG's performance last week has attracted the attention of many Reddit traders. Could a short squeeze be in the works?

Vinco Ventures  (BBIG)  is a small-cap company that operates 13 consumer and digital marketing brands, including 911 Help Now, SRM Idea Lab, and Ferguson Containers.

The company's business model is based on "aggressive acquisitions" using its BIG strategy: buy, innovate, and grow.

Although it has received little coverage from the media and Wall Street, the stock has been getting attention on Reddit due to its recent performance and its history of short squeezes.

With short interest in Vinco Ventures growing, it's possible that BBIG could become a meme stock and undergo another short squeeze in the short term.

Figure 1: Vinco Ventures logo.

Figure 1: Vinco Ventures logo.

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BBIG's Short-Squeeze History

Vinco Ventures stock is no stranger to the short squeeze. During 10 trading days between August 26 and September 9, BBIG shot up an incredible 268%. At the time, it was recorded that traders sold short $174 million in dollar volume. That was more than double the next short interest report, in which $66 million in dollar volume was sold short leading up to December 31, 2021.

One of the possible catalysts of September's short squeeze was the company's announcement of a joint venture with Zash Global Media to acquire Lomotif, a TikTok-style social media platform that is very popular in India. Through its subsidiary Emmersive Entertainment, Lomotif recently launched a platform for music streaming and NFT livestreams.

High Short Interest

There's a lot of short interest in BBIG — in fact, 21% of its current float is shorted. (Anything over 10% is generally considered high). Meanwhile, the stock's popularity among Reddit traders is growing. This sounds the alert for a possible short squeeze.

Figure 2: BBIG short interest over time.

Figure 2: BBIG short interest over time.

Theoretically, this indicates that the level of investor confidence in the company's fundamentals is generally low. This can also serve as a warning that Vinco Ventures is a bad investment for the long term.

However, keep in mind that, because the company has a modest float of 123 million, BBIG's daily average trading volume in the last three months corresponds to 20% of it. And its trading volume in the last 10 days corresponds to 35% of the float.

This implies that it could be quite dangerous to bet against BBIG, especially with its meme appeal.

BBIG's Reddit Popularity

According to the website, BBIG was among the top five most-talked-about tickers on Reddit from January 14 to the morning of January 17. That's quite an impressive feat for a small cap, even if the reason behind is the incredible 78% growth performance in the last 5 trading days.

Figure 3: Trending stocks on Reddit on January 18.

Figure 3: Trending stocks on Reddit on January 18.

BBIG has been trending on one of the most active stock market subreddits, r/Shortsqueeze. This thread has more than 193,000 members aiming to find new potential short squeezes.

If Redditors can provoke another short squeeze, BBIG may be their next target.

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(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting the Wall Street Memes)