Stocks to Watch: HEC, DodgeCoin, Atomera, and Ethereum
Hudson Executive Investment Corp. (HEC)
2020 was the year of SPACS (special purpose acquisitions companies), and with large companies jumping on to this new and efficient format for IPOs, the acquiring companies receive lots of attention from both private and public investors. Hudson Executive Investment Corp (HEC) is no exception given the company’s recent acquisition of Talkspace, an online mental health and therapy company. Since HEC is a blank check company with no commercial operations, to determine its potential, it is important to take a look at Talkspace as a company and its prospect for success in its upcoming IPO.
Talkspace is a company focused on providing mental health services through online subscriptions. These subscriptions connect therapists with patients through video calls, messaging, and audio messages. As COVID-19 led to an increase in mental health concerns with levels of anxiety and depression at an all-time high, Talkspace has seen phenomenal success through its online platform.
This is indicated by Talkspace’s enterprise value, which has floated around $1.4 billion upon talks of public offering. Reporting $38 million in revenue in 2019 and $75 million in revenue in 2020, Talkspace is expected to earn $125 million in 2021. The company was able to earn $75 million in revenue on just 46,000 customers, showing just how effective their business model was and could continue to be.
Atomera finished the week with their highest share price ever. A semiconductor materials and technology licensing company based out of Los Gatos, California, Atomera is known for developing the first quantum engineered material named Mears Silicon Technology. The company recently announced that they will be releasing fourth quarter and fiscal year 2020 financial results after market close on Wednesday February 10th. This will show whether or not the excitement around the company is accurate.
Atomera is in the best case scenario right now, with the tech market being adopted as the company makes new innovations daily. Reaching highs of $43.52 to end the week is a big step for Atomera. The company looks to continue this trend in the future.
The age of cryptocurrency and decentralized financial systems is upon us. This year, cryptocurrencies have outpaced the general market by miles. Bitcoin alone has shown a 290% increase in price this year, compared to a measly 17% for the $SNP. Even more impressive, the second largest market cap cryptocurrency, known as Ethereum, has increased 741% in the past year.
Ethereum, like bitcoin, was one of the first blockchain derived currencies to come to market in 2015. The system is very similar to that of bitcoin in the sense that both are decentralized currencies that are not backed by any governments or regulatory bodies. Instead, these currencies are backed by mathematical calculations which require large sums of work and energy.
What sets Ethereum is that the currency operates as a network on which other cryptocurrencies and applications can be built. In other words, Ethereum is much more creator friendly than bitcoin. This is one reason why it has been so successful as a cryptocurrency. Other cryptocurrencies such as ROT and the recently infamous Dogecoin derive their price from bitcoin and have contributed to its massive rise in popularity. Given that many more currencies are likely to emerge, Ethereum is a good looking investment because it will likely continue to grow for some time.
GameStop Corp. (GME) took the investing world by storm these past few weeks with hedge funds over-shorting the company and retail investors rallying on the subreddit page “Wall Street Bets”. The price shot up from low $10–20 into an all-time high of $400 before dropping as hedge funds retaliated with their own barrage of brokerage trade restrictions and price manipulations. Although through all this madness there is absolutely no traditional valuation or sensible research backing up the price, it goes to show the power of retail investors when they band together towards a common goal. Call it market manipulation or gambling with the NYSE, the GME rally has made people on both sides millions of dollars within weeks.
Next, the Reddit users of WSB (r/WallStreetBets) have set their sights on DogeCoin in hopes of pushing its price to $1. Until January 27th, the price of DogeCoin was consistently around $0.0075. Then, the stock began to pick up traction on the subreddit page until it skyrocketed to $0.0472 on Jan 29th. To put the jump into perspective, a $10,000 investment into DogeCoin on Jan 27th would be $62,933 by Jan 29th. Given that the price has been extremely volatile since then, it’s interesting to see how a group of people have been able to influence the price of an otherwise worthless coin into 600% increase within two days.
Social media chatter from the likes of Elon Musk and Mark Cuban only fueled the fire. On February 4th, the price hit an all time high of $0.0533. Although this stock is a bit different from past stocks in this section, it’s definitely an interesting one to keep an eye on.