Shares of Rumble (NASDAQ: RUM) surged today as it continued to ride a wave of support following President-elect Trump's victory last Tuesday. It was one of several stocks in the so-called "Trump trade" to gain on Monday as Tesla and cryptocurrencies like Bitcoin also popped. There wasn't any major company-specific news out on Rumble, which is essentially a conservative alternative to YouTube, but there was one item that could have spurred gains in the stock.
Rumble stock closed up 18% on the day.
Image source: Getty Images.
Rumble has a significant backer
Rumble initially soared in after-market trading last Tuesday, but the stock ended up in the red on Wednesday, a sign that investors may have seen it as a buy-the-rumor/sell-the-news type of event.
However, after momentum in the stock built on Friday, Rumble jumped today even as the S&P 500 index was nearly flat as markets continued to shake out following the election.
One news item that may have given the stock a boost today is that Dave McCormick, previously the CEO of the hedge fund Bridgewater Associates, won the Senate race in Pennsylvania. According to reports, McCormick's biggest individual stock holding is Rumble, of which he owns an estimated $4 million.
While that fact shouldn't directly impact Rumble's business, it could attract more investors to the stock since McCormick is both a hedge fund megamillionaire and now a U.S. Senator.
Will Rumble's momentum continue?
Rumble reported last week that its platform broke multiple records on Wednesday night, including the number of live streams, live concurrent views, consumption, Rumble Premium subscribers, and advertising revenue. The company set a record of 1.79 million concurrent viewers on election night as well.
It's unclear if that momentum will continue for Rumble, but Trump's election figures to benefit the company as it's likely to draw more attention to conservative media platforms.
Still, Rumble is small and unprofitable today, so the company has a lot to prove in order for the social media stock to be a winner.
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Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Tesla. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
