The second “meme stock” wave may be over. But who’s to say it’ll be the last one? Once the sell-off in stocks bid up aggressively in the last month ends, names like Vinco Ventures (NASDAQ:BBIG) stock could be worth the risk.

Why? Admittedly, this isn’t a stock to buy based on its fundamentals. At first glance, the company, which is in the process of merging with two digital media businesses (more below), appears overpriced and over-hyped. Instead, it’s more of a wager on investor psychology. Specifically, that either a repeat of the “meme stock madness” or company-specific developments get speculators overly excited about it once again.

If another “meme stock wave” happens? Heavily shorted Vinco may again go parabolic, rising back to $5 per share, or even its high of $6.05 per share. If we see further news regarding its merger plans? This, too, could fuel another pop. So, what’s the problem? If neither catalyst plays out, shares are likely falling back to their pre-meme prices (between $1.25 and $1.50 per share).

So, with big possible downside risk, what’s the best way to play this?

If you’re bullish it has room to pop once again, sit out for now, as it trends lower. But consider it worthwhile if it falls back to between $2 and $2.50 per share.

Potential for BBIG Stock to Pop on Next Meme Stock Wave

Could BBIG stock rally if there’s another meme stock wave. The Reddit trading community may have jumped on this stock based on its moderately high short interest (16.3% of outstanding float, as of June 30). But in the immediate future, it’s going to be tough to profit from short-squeeze plays.

Already bid up enthusiastically in June, traders who got in early have already taken profits (so much for “diamond hands”). Vinco stock traders a little late to the party? At first, only a few developed “paper hands,” as seen from its gradual slide in recent weeks. But as uncertainty (via the delta variant of Covid-19) hits the market once again, this is starting to accelerate.

That’s bad for investors who got in at too high a price. Yet, as this exodus continues, Vinco will likely settle at the prices its shares fetched back in April and May (between $2 and $2.50 per share). Granted, it’s still high risk at these levels, given there’s little for the stock to fall back on (negative book value, current operating business is very unprofitable).

However, while still overvalued at $2 to $2.50 per share, buying at those levels could be highly profitable. “Meme stock mania” may seem like a trend that will fully disappear, perhaps when things (finally) “get back to normal.” Yet, as Barron’s recently made the case, this trend may be far from over. Another round could be just a few months away.

Given that a large percentage of total trading volume in BBIG stock continues to be short volume, short-interest could remain high, making it easy for this stock to get squeezed once enthusiasm returns.

Merger Catalyst Could Move Needle

A return of meme stock madness is a possible factor that could pop BBIG stock another time. Fortunately, it’s not the only one. Factors specific to the company could help boost shares once again. Even if a “third wave” of madness fails to develop.

Why? The entities it’s acquiring (TikTok-esque platform Lomotif, and digital media company ZASH Global) are in the types of industries now hot with investors. Vinco’s no stranger to chasing trends, as seen from its move into NFTs (non-fungible tokens).

As InvestorPlace’s Mark Hake discussed July 7, Vinco is spinning off this NFT division. But with its operating businesses post-restructuring, it’ll still be able to craft a narrative that gets investors excited for it once again. Especially around Lomotif, which could help sell BBIG stock as an opportunity to “get into the next TikTok early.”

Putting it simply, Vinco may not necessarily need another “meme stock wave” to move its needle once again. If you get in at a low enough price, the possible gains could vastly exceed downside risk.

Even if Bullish on Another Pop, Sit Things Out for Now

Vinco has plenty of potential down the road to pop once again. Yet, in the meantime? As meme stocks trend lower, there’s little need to buy ASAP, as BBIG stock (even trading at $3.40-plus per share) could soon fall back to between $2 and $2.50 per share.

At a low enough price, risk/return will return in your favor. If you’re bullish that another round of “meme stock madness,” or the possible buzz around Lomotif, could propel BBIG stock back to its highs once again, sit tight for now, but get ready to buy once it finds its floor.

On the date of publication, Thomas Niel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Thomas Niel, contributor for InvestorPlace.com, has been writing single-stock analysis for web-based publications since 2016.