The story of ContextLogic (NASDAQ:WISH) has evolved since it went public in December. At first, WISH stock was a hot e-commerce play, priced as if its pandemic-era growth rates would persist.

Months later, as its pandemic tailwinds faded, it became a short-squeeze play. Retail traders piled in, hoping to squeeze it just like they did with AMC Entertainment (NYSE:AMC) and GameStop (NYSE:GME). Unfortunately, it didn’t play out that way.

Its appeal among meme traders was short-lived, and shares pulled back again. Then, starting in August, after releasing lackluster quarterly results, WISH stock took on new life as a turnaround play. Due to declining sales and widening losses, ContextLogic announced sweeping strategy changes.

If these plans work, it could enable shares to mount an epic recovery. Even a partial rebound would mean big returns for those buying WISH stock today, at around $5.25 per share.

The problem? Right now, the play here is mostly built on the hope of a turnaround rather than evidence that one is underway. So, should you wait until the evidence arrives? Not necessarily. WISH stock is likely to get a big jolt on the first signs its comeback is happening. So, taking a wait-and-see approach may not work in this situation.

ContextLogic’s Leap-of-Faith Turnaround Plan

For a turnaround to succeed, ContextLogic basically has to reinvent the business model for its Wish.com e-commerce marketplace.

Before, it found success spending heavily on online ads to attract users. This, in turn, led to sales for the third-party merchants (selling what many consider to be lower-quality merchandise) on its platform. Today, the company is taking the opposite approach. It’s focusing on building a permanent user base rather than spending a lot on ads to support a constant churn of buyers. It’s also looking to improve the quality of the products offered on the site.

So far, there’s little evidence this is going to play out. The company has admitted it will take until the second half of 2022 for its changes to (possibly) lead to a return of revenue growth. In the meantime, even as it reduces its ad-spending costs, continued cash burn could mean a further dent in its cash position, which sits around $1.6 billion today. As a Seeking Alpha commentator noted back in August, the company may need to execute a dilutive capital raise down the road.

There’s much pointing to the situation getting worse before it gets better, meaning buying WISH stock today requires a leap of faith. You may want to wait it out, until there’s proof that said turnaround is underway. But by the time the evidence is in, the opportunity will likely have come and gone. However…

There’s No Harm in Waiting for Lower Prices

Expectations for WISH stock are so low right now, any sort of small positive news may be enough to send the price much higher. For example, it may take just better-than-expected quarterly results to send it back to $10-$15 per share, even if the results aren’t outstanding.

Investors who wait for uncertainty to ease may find it hard to get in at a worthwhile price and face limited upside. However, there is another viable approach: waiting for lower prices before taking a position.

Shares seem to have found a floor at current price levels. However, between now and when the company starts posting better results, perhaps next year, we could easily see WISH stock fall further. If this happens, it could provide a more favorable entry point.

Alternatively, if you want exposure to a turnaround but think WISH stock has bottomed out, you could take the approach I recommended in my previous article on the stock. That is to ease into it, buying some shares now and adding to your position if the stock sells off some more.

The Bottom Line on WISH Stock

Many may be waiting for the situation with ContextLogic to look less dicey before buying WISH stock. But, as I stated above, by the time that happens, much of the potential upside will have been realized.

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.