This is a long one so grab your sushi and your stuffed crust pizza.
BBIG is a joke company, it is the traveling salesman trying to come up with that one big idea that will save himself from bankruptcy. BBIG has been a nasty web to untangle and I still haven’t scratched all the way to the bottom just yet.
After looking through what BBIG is fundamentally I have found that it’s core model is buying up worthless or near worthless companies and hyping them up to be something they aren’t.
For instance this is a list of what brands BBIG currently owns
Ferguson Containers
SRM Idea Lab
Cloud B
Best Party Concepts
Pirasta
4keeps Roses
Edison Nation Medical
Smarter Specs
Human Earth
Purple Mountain Clean
Uber Mom
911 Help Now
Everyday Edisons
Some of these brands are simply not on the internet or have no website and can not be found, others advertise innovative products like cake pops or light chasers, the little spinny toys that light up. These brands also feature no name rappers and “influencers” who hype them up in an attempt to continue BBIGs innovation story and build a sense of strong fundamentals. Since these are mostly Pennsylvania based brands it has become literally the Michael Scott Paper Company.
This is where the Moviepass vibe comes in as the founder of BBIG was the chairman of Moviepass which notoriously was a failed startup that had 0 plan to be anywhere close to profitable and stayed alive for two years off hype and attempts at spinoffs and mergers just like BBIG.
Didn’t believe the light chase part? This is from SRM idea lab a BBIG brand
All of these brands and acquisitions seem to be an attempt to become some parent company of brands that would get laughed at on shark tank.
With it’s backbone of brands belonging mostly at a strip mall in Omaha BBIG has to turn to it’s two biggest pipe dreams, Lomotif and Cryptyde. Cryptyde is an NFT marketplace platform that took much longer to find than it should have and is built by a middle schooler. Lomotif is a cheap copy of TikTok but also is their most attractive brand as it has millions of users yet still BBIG is deeply unprofitable.
The big deal right now however isn’t Lomotif it’s TYDE, The soon to be publicly traded version of cryptyde. BBIG is having a dividend spinoff for TYDE on the 22nd and to retail traders this has become a super catalyst that they imagine can bring BBIG to the moon. This will not happen, TYDE will have little to no affect on BBIG come dividend date and I’m more concerned about what happens after the dividend. TYDE simply will be a penny stock and will not be the tendie multiplier many BBIG holders think it can be.
The bull case for BBIG is that this dividend does matter and it will move the stock on an uptrend fueled by their brands performing well and TYDE living up to it’s hype, this is all based on hopium. My case is it’s a 1 for 1 dividend of a company that is realistically going to at best be a small NFT marketplace that makes a couple million every year.
Here is the brand Cryptyde, really innovative
Dilution is also occuring through employee payments and getting money to pay for these acquisitions. This will only add onto the stocks problems.
On to money, BBIG lost 240 million last quarter (8.50 per share). They have 74 million cash on hand. The only path to profitability is Lomotif and TYDE being superheros and they are no Batman and Superman.
Summarizing, BBIG was trading in the dollar range at the start of the year and due to retail sentiment has been ran up massively. However pumping can only take this so far and with a worthless dividend and dilution it seems that BBIG is coming to a head with all it’s plans ending this week we can see the return to reality soon.
So what do we do, I imagine three scenarios
1- BBIG continues this hype train for anywhere between a day and a month and then begins it’s slow but inevitable collapse as the realization sets in that this is a as seen on TV company.
2- BBIG is saved by one of these brands actually taking off and becomes a profitable company three years down the line
3- BBIG is peaking and about to fall off a cliff once the dividend drama ends
I am betting on a mix of 1 and 3. I haven’t gotten in yet and am waiting for the breakdown to confirm that the dividend will accomplish nothing and that this is an overstretched stock. Once that occurs I will probably go into puts for 5s or 6s for late November or December.
Puts are the play but IV is high and this stock is able to move fast randomly so wait for it to really breakdown to get in because I wouldn’t be surprised if it ran for another day or two this week.
This play could be a quick one day Guh on BBIG or a slow burn for weeks so if you are getting in have the plan to hold puts for a little bit it’s not a ten bagger play.
Disclaimer: I wrote this while I was half asleep and there is much I haven’t been able to find on BBIG yet that could be bullish.
