|A falling stock price. Market headwinds. Public acknowledgement that the business is struggling.
These aren’t things normal investors hope to see in a company. But then again, the meme-stock crowd isn’t full of normal investors.
The group that upended Wall Street by backing struggling companies like GameStop and AMC Entertainment in 2021 might have a new potential target: WeWork.
As Insider’s Matthew Fox writes, the co-working office company is a prime candidate to become the next hot meme stock. WeWork shares surged as much as 162% after the company warned it had “substantial doubt” about its ability to keep operating.
WeWork’s financials might not be pretty, but it has many characteristics that could make it attractive to the meme-stock crowd.
Not only is it a well-known consumer brand, but it’s had a public fall from grace. From aspirations of a $100 billion valuation, to going public in a SPAC merger valuing it at $9 billion in 2021, WeWork’s market cap is now less than $500 million. That type of down-on-its-luck story might resonate with the meme-stock crowd, which seems to love an underdog narrative.
There’s even an Apple TV+ series — “WeCrashed” — about its rise and fall that could be fodder for literal memes, particularly of actor Jared Leto playing WeWork’s controversial cofounder Adam Neumann.
And being a meme stock can be good for business! While shares of GameStop, the poster child of the meme-stock revolution, returned from their all-time highs, they’re still well above pre-2021 levels.
Of course, meme-stock status doesn’t guarantee a company’s survival. Bed Bath & Beyond rode the meme-stock frenzy to a 99% surge in share price in January 2021. But this April, the company filed for Chapter 11 bankruptcy, liquidating all of its stores by the end of July.
But the brand lives on as a result of Overstock.com acquiring and adopting its name, and perhaps in the hearts of meme-stock traders who managed to cash out in time.