Meme Stocks: Two Approaches to Investor Communication

The Dichotomy of Meme Stocks

The return of public interest in meme stocks highlights a fundamental split in how these companies engage with investors. Two distinct classes of meme stocks have emerged: those that actively communicate and those that remain largely silent. This article examines these contrasting approaches to investor relations.

"Loud" Meme Stocks: Engaging with Investors

Companies like Tesla ($TSLA) and AMC ($AMC) exemplify the "loud" meme stock approach. Their CEOs are highly visible, frequently engaging with investors and promoting future products. This includes recent Tesla announcements regarding FSD, RoboTaxi, Optimus, and new vehicle lineups, irrespective of the immediate feasibility. Similarly, AMC's management consistently highlights its popcorn sales and upcoming blockbuster releases, aiming to draw patrons back to cinemas.

Leveraging Earnings Calls and Social Media

These companies host extensive earnings calls where management discusses strategic initiatives and financial performance. Their CEOs maintain active social media presences, fostering a community of followers who advocate for their products and vision. For professional investors seeking to analyze management commentary, platforms like Marvin Labs provide valuable resources. For instance, detailed transcripts of the TSLA 1Q2024 Earnings Call and the AMC 1Q2024 Earnings Call are available, allowing for in-depth investment analysis of management's statements.

"Silent" Meme Stocks: Focusing on Short Sellers

In contrast, "silent" meme stocks, such as GameStop ($GME) and Trump Media & Technology ($DJT), largely avoid direct communication with investors, often limiting their public statements to grievances about alleged short sellers.

Lack of Investor Communication

These companies typically forgo traditional investor outreach like earnings calls. Their regulatory filings are often minimalistic, providing only the essential disclosures required. For example, GameStop's recent earnings report notably provided only approximate ranges for sales and expenses, rather than precise figures.

The Focus on Short Squeezes

With limited company-provided information, much of the market discussion around these entities centers on alleged market dislocations and the potential for a "Mother of All Short Squeezes." Investor speculation, rather than operational performance, often drives valuation, leading to scenarios where companies like GameStop trade at significant price-to-earnings multiples or DJT at high revenue multiples, irrespective of underlying fundamentals.

Choosing Your Meme Stock Focus

As meme stocks continue to capture investor attention, understanding these divergent communication strategies is crucial. Professional investors may prefer to focus on companies that provide material insights and engage in transparent dialogue, allowing for data-backed investment analysis and informed decision-making. This approach enables a substantive discussion of future prospects, such as Tesla's autopilot or AMC's theatrical releases, rather than mere speculation on market phenomena.