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MARKETS LIVE BLOG:

STOCKS CLIMB AS DOW POSTS 8TH STRAIGHT WIN

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Should You Buy Lottery Stocks?

Tracey Ryniec
Higher sales volumes for aircraft carriers and navy nuclear support services are expected to drive revenues for Huntington Ingalls' (HII) Newpoer News segment in Q1.

  • (1:00) - Lottery Stocks: What Are They and How To Find Them?

  • (6:30) - Is Insider Buying A Good Sign To Start Investing?

  • (16:50) - Sectors Primed For Lottery Stocks: Retail and Pot Stocks

  • (23:00) - Are They Worth It?

  • (28:30) - Episode Roundup: NVAX, PIR, JCP, CRON, ACB, TLRY      

  • Podcast@Zacks.com

Welcome to Episode #174 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.

In this episode, Tracey is joined by Zacks Account Manager Niko Yokosawa and Zacks Product Manager Derek Kaplan, to discuss the interesting phenomena of “lottery stocks.”

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What’s a Lottery Stock?

A lottery stock is a stock where if a particular event happens, the shares will either soar or crash back down to earth.

It’s an all-or-nothing type bet. Just like the lottery.

Can you play the lottery to only kind-of win? Of course not. That’s true of lottery stocks too. Investors have to be prepared to lose everything.

And while the odds may be against you when playing the lottery, you keep playing because of the dream of winning.

That’s true of lottery stocks as well. The dream of a big “win” is what drives investors.

Where Can You Find Lottery Stocks?

Often, lottery stocks are in the biotechs and drug stocks.

Tracey shares her tale of investing in Novavax NVAX), a drug company trying to bring an RSV vaccine to the market.

Novavax went to Phase III twice on its RSV vaccine. What could go wrong?

But lottery stocks can also be found in the beaten down retailers such as J.C. Penney JCP, which is trading around $1.30, and Pier 1 Imports, Inc. PIR which has sunk under $0.50 after another dreary earnings report.

Are Pot Stocks Lottery Stocks?

Lottery stocks are synonymous with a big payoff. For that reason, they are also risky.

Could the pot stocks be lottery stocks too?

Tilray TLRY was up as much as 400% at one point, with many talking about a pot stock bubble, before pulling back.

Aurora Cannabis ACB is another hot cannabis stock that went from $2 to $9.

Neither one has positive earnings yet.

What else should you know about the lure of the lottery stocks?

Listen to this week’s podcast to find out.

Breakout Biotech Stocks with Triple-Digit Profit Potential

The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.

Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +98%, +119% and +164% in as little as 1 month. The stocks in this report could perform even better.

See these 7 breakthrough stocks now>>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Novavax, Inc. (NVAX) : Free Stock Analysis Report
 
Pier 1 Imports, Inc. (PIR) : Free Stock Analysis Report
 
J. C. Penney Company, Inc. (JCP) : Free Stock Analysis Report
 
Aurora Cannabis Inc. (ACB) : Free Stock Analysis Report
 
Tilray, Inc. (TLRY) : Free Stock Analysis Report
 
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Zacks Investment Research