Robinhood, the stock-trading platform that popularized free trades, grew its user base from 1 million users to over 13 million in just four years. That explosive growth, which was largely supported by younger investors, forced older online brokerages to offer free trades.
Robinhood regularly updates its list of the 100 most popular stocks (by holdings) among traders on its platform, which predictably include big tech companies like Amazon, Microsoft, and Google parent Alphabet. However, that list also includes a lot of weaker tech stocks with limited growth potential.
Four of the stocks on that list caught my eye: GoPro (NASDAQ: GPRO), Fitbit (NYSE: FIT), Lyft (NASDAQ: LYFT), and Uber (NYSE: UBER). Do the popularity of these stocks on Robinhood highlight potential turnaround plays? Or are too many investors simply chasing hot names and headlines instead of doing their due diligence?