Wall Street sentiment is cautiously optimistic this morning with all major indexes up slightly in early trading. Is there enough gas in the tank to sustain the Dow’s winning streak for a fourth straight day? Stay tuned to find out.
Names like Tesla (TSLA) and Nio (NIO) are typically what come to mind when we think of the automotive rally in 2020. But smaller names in the sector have the potential to offer just as much. Today’s trade alert highlights a fairly new name in the public markets, one that you might not be familiar with yet, but you should be.
Vroom, Inc. (VRM) operates an e-commerce platform for buying, selling and trading-in used cars online.
Vroom went public at $22 a share last June, shot up to a $47.90 close on its first trading day and got as high as $75.49 intraday on Sept. 1 but has since slid back. In any instance, this would be a major red light for any investor but a closer look behind the scenes reveals the full picture.
In hindsight, Vroom made its debut in the midst of the pandemic, and with a strong e-commerce presence, it was grossly unprepared for the avalanche of new orders. Ultimately, the company had to forgo potential revenue due to a lack of inventory to meet demand. This led to a drop in its sales numbers and stock price as a result. However, looking ahead, analysts believe that Vroom is poised for a strong comeback.
Of 14 analysts offering recommendations for VRM, 10 rate the stock a Strong Buy, compared to 3 Hold ratings and only 1 Sell rating. With more inventory on hand and strong digital demand, this company is one of the best growth stocks to buy on the dip.
Where to invest $100 right now...
Before you consider buying Vroom, you'll want to see this.
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