GameStop Corp. (NYSE: GME) has been one of the biggest stories of the year. The stock has gained around 1,200% in the last six months.

It had doubled in just two days of trading last week, followed by a slight pullback.

It's crazy to think how Gamestop stock was under $5 at this time last year. It would have officially been considered a penny stock by the U.S. Securities and Exchange Commission.

Now that it's far from a penny stock, we have a few other cheap stocks that could see similar gains in the coming months. This is all thanks to institutional interest in the stocks.

You will hear stories about new console sales and better-than-expected holiday results-driving GameStop's success. But none of that explains the massive rally.

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Why Is GameStop Stock Going Up?

Really, GameStop has been a classic short squeeze. Traders were betting the company would continue to decline. At the end of 2020, the final figures showed that shorts had a massive position in GameStop.

Then, Ryan Carlson, the founder of Chewy Inc. (NYSE: CHWY), took an activist position and was actively buying more stock. Tiger Cub Lee Ainslie noticed the activist buying, and he began buying the stock. So did the momentum investors at Driehaus Capital Management.

As the institutions began to bet on the potential success of Mr. Carlson, the stock began to rise. When the stock began to rise, the shorts had to buy back the stock they sold. That forced the price even higher. What happens in 2021 when your stock price is moving higher?

Everyone wants in, and the stock explodes higher on massive volume.

Don't worry if you missed the move in GameStop. It is probably not a good idea to trade for a bounce in the stock now. The move is over, the shorts have been covered, and it is still not a very good business.

We can find stocks that have some of the same characteristics as GameStop before the rally. We want to find stocks with high short interest but that are beginning to attract some institutional buying that could force the shorts to cover.

Here's the first cheap stock today…

Cheap Stock to Buy on the 5G Wave

Gogo Inc. (NASDAQ: GOGO) is one stock that has the potential to make the same type of move that GameStop made this year. Gogo provides wireless services for the business aviation industry. It offered similar services to commercial airlines but recently sold that business to Intelsat (OTCMKTS: INTEQ) for $400 million.

Gogo used the cash to pay down debt and invest in Gogo 5G services' rollout.

While Gogo initially took some hits when the pandemic began, it has since recovered, and most customers who suspended or downgraded service have returned.

We are starting to see some institutional buying enter the market for shares of Gogo. Private equity firm GTCR purchased almost 15% of the company in the last quarter of 2020. In total, 50 institutional buyers, including more than 50 hedge funds, were buying Gogo shares in the fourth quarter.

More than 40% of the shares of Gogo are sold short right now. As the stock continues to move higher, shorts will be pressured to buy back the shares they sold short to limit their losses.

One more piece of good news from Gogo could be the catalyst to send the shares doubling in the next year.

This Cheap Stock Is Going to Space

Virgin Galactic Holdings Inc. (NYSE: SPCE) is also heavily shorted right now. Speculators have bet against the story stock by selling 81% of the shares short.

Virgin Galactic will end up being a leader in commercial and scientific space flight at some point. It intends to offer space tourism as well as scientific missions to the edge of space.

A December test flight was cut short when the rocket motor ignition sequence was aborted. While it was not a success, it did prove that the safety systems installed on the aircraft worked as intended. Fifteen minutes after the rockets failed to ignite, pilots were able to land the vehicle back at Spaceport America in New Mexico.

The stock sold off somewhat after the failed test but has recovered much of the lost ground.

It has already moved up by almost 30% in January after Ark Investments filed the paperwork with the SEC to start a space-themed exchange-traded fund.

That could be a significant source of additional institutional buying in the stock. That would be on top of the more than 160 institutions that have been buying the stock recently.

That's causing short sellers to feel some pain. Any good news from Virgin Galactica, such as a successful test flight, could cause it to panic and send the stock dramatically higher very quickly.

You may have missed the move in GameStop, but as long as we are in a liquidity-fueled bull market, there will be more chances for explosive profits.