Small investors and Wall Street analysts are on the same page quite a bit. For example, several of the 100 most popular stocks on Robinhood -- a trading platform that caters to small investors -- are also favorites of analysts.
However, there are certainly some differences of opinion. Some picks that retail investors think have great prospects are ones that analysts are decidedly bearish about. Here are two popular Robinhood stocks that Wall Street predicts will plunge more than 25%.
Wall Street analysts don't think so highly of BlackBerry, though. The consensus price target is nearly 40% lower than the current share price. Analysts appear to see limited near-term growth opportunities for the company.
Are Robinhood (and Reddit) investors seeing something in BlackBerry that Wall Street is missing? Maybe so. The company isn't solely focused on smartphones, as it was in the past. It now also develops cybersecurity products and software used in vehicles' driver-assistance, instrument, and infotainment systems.
BlackBerry's QNX operating system has scored wins with 23 of the top 25 electric vehicle original-equipment manufacturers in the world. The company is working with Amazon on the IVY cloud-connected platform that enables automakers to gather and use vehicle data.
The company's SecuSUITE voice and text encryption is used by 18 governments. Its Jarvis security testing platform was named "best in breed" for protecting mission-critical software supply chains in an analysis conducted on behalf of the U.S. Department of Defense.
Wall Street could be right about BlackBerry. But it just might be one of a handful of meme stocks that could still make investors rich over the long run.
Senseonics Holdings (SENS -0.89%) isn't as popular with Robinhood investors as BlackBerry is. But the medical device maker still ranks in Robinhood's top 100. Its stock has also been a huge winner in 2021 with shares skyrocketing close to 270%.
Wall Street appears to believe that Senseonics has gained too much too quickly. The average price target for the healthcare stock is 27% below the current share price.
Senseonics markets the Eversense implantable continuous glucose monitoring (CGM) system for diabetics. The company recently reported promising results from a clinical study of this system, showing a confirmed detection rate of 93% for low blood sugar alerts with the device's primary sensor and 94% with its secondary sensor.
Probably the main issue that analysts have with Senseonics right now is its valuation. Shares trade at a whopping 119 times sales. And the sales the company has generated so far are puny: only $2.85 million in the latest quarter.
So why do Robinhood investors like Senseonics so much? They're likely confident about the company's prospects. For example, the Food and Drug Administration is reviewing Senseonics' filing for authorization of a version of Eversense with sensors that last for 180 days, which is twice as long as the current version of the device.
Investors could also be upbeat about Senseonics' partnership with Ascensia. The large diabetes-care company took over full commercialization of Eversense in the U.S. market in April. Ascensia is also handling sales and marketing of the CGM in certain European markets. The company should be able to drive higher sales in a way that Senseonics couldn't do on its own.
However, Senseonics expects sales in 2021 will only be in the range of $12 million to $15 million. That might not be enough growth to keep its valuation propped up at the current nosebleed levels.