Former President Donald Trump continues to have a massive impact on the markets. Although he has left the White House, his influence is still felt with so-called “Trump stocks.”
Digital World Acquisition Corp (NASDAQ:DWAC) wrapped up its IPO in September when it began trading under the ticker DWAC. In October, Trump Media & Technology Group announced a planned merger with DWAC. In the wake of this major announcement, several other companies are doing very well.
Consequently, investors are also earmarking these Trump stocks for big gains. With a mission to build digital properties to oppose “liberal bias” and censorship, Trump Media is launching Truth Social. According to the company’s mission statement, this social media platform will encourage an open global conversation without discriminating based on ideology. Truth Social has avoided any major setbacks in its beta app launch. However, it did find itself at the center of a controversy after federal regulators started investigating them for their communication with Trump before details of the deal became public.
If you want to put your hard-earned money into DWAC, then volatility comes with the territory. That is why, if you are a conservative investor to achieve steady returns, then investing in Trump stocks is better than investing in DWAC directly.
Some of the names of the list might strike you as new. However, others are more established players. So, when investing in the following names, keep your risk appetite in mind:
- CF Acquisition Corp VI (NASDAQ:CFVI)
- Salem Media Group (NASDAQ:SALM)
- Grom Social Enterprises (NASDAQ:GROM)
- Phunware (NASDAQ:PHUN)
Trump Stocks: CF Acquisition Corp VI (CFVI)
CF Acquisition Corp VI is in the same boat as DWAC. The SPAC recently announced it was merging with Rumble, a streaming platform that claims it has fewer restrictions than Alphabet’s (NASDAQ:GOOGL, NASDAQ:GOOG) YouTube.
The platform is attracting a lot of interest from the conservative userbase. Many of these consumers are members of a pro-Trump crowd. Incidentally, the former president has found a place on the platform.
Truth Social also has a distribution platform with Rumble, another reason it is exciting investors. Plus, while Truth Social will take some time getting off the ground, Rumble finished with 36 million average monthly active users at the end of the third quarter. Part of the reason why Rumble is doing well is that it is trying to reach out to people from both sides of the aisle. At the moment, the platform has a reputation for conservative voices. However, it has also signed former U.S. Rep. Tulsi Gabbard, a prominent Democratic contender in the 2020 presidential campaign.
As always is the case with Trump, it is important to temper your excitement. Due to the close association with the former president, a level of volatility is par for the course. When the DWAC deal was announced, CFVI did well. On the flip side, when news emerged regarding regulatory activity concerning DWAC, the stock tanked.
If Truth Social and Rumble’s relationship deepens, you can expect more price action.
Salem Media Group (SALM)
If you are looking for a conservative slant in the news, chances are you have probably heard of Salem Media. The conglomerate operates a sprawling empire with everything covered, from magazines to television programs. It targets Christian audiences with conservative values.
Salem Media’s estimated 11 million radio listeners and 153 million hits via its website and app; a huge user base. SALM also has over 40 million active email addresses on file, making it easy to reach those interested in what you have to offer.
Salem Media became notable for giving the news from the conservative perspective in the last election cycle. Their audience numbers suggest millions of people out there like their services. Through a series of mergers and acquisitions, it has grown to become an influential conservative media giant. Hosts like Hugh Hewitt, Mike Gallagher and Dennis Prager are helping it stave off competition from iHeartMedia’s (NASDAQ:IHRT) iHeartRadio and Cumulus Media’s (NASDAQ:CMLS) Westwood One.
For the third quarter, revenue increased 8.8% to $66 million. Operating expenses regularly grew by an even more impressive 12%. It led to profitability in Q3 with EBITDA at 12.5%. Network broadcasting revenue increased by 9.3% to $49.6 million, but operating expenses also grew at a rate of almost 10%. As such, overall station-level profitability jumped 9.2% to $12.1 million.
Trump Stocks: Grom Social Enterprises (GROM)
Grom, a social media platform for children under 13 and an original content provider of entertainment, listed on the Nasdaq in June. The internet is an exciting place for children to explore, but often they have no idea what territory lies beyond their screens. That’s why Zach Marks created Grom Social – so that kids could find a safe space on social media where adults could help them learn more about how this new world works.
The site’s founder got inspired to create the platform after his own experiences with social media at an early age. When Marks was only 11, he created a social media profile without notifying his parents. When his parents discovered that he had made the account they made him delete the account. It was at this point he thought about producing an online social network for kids like himself.
Grom operates through four different subsidiaries. However, Grom’s revenue comes from a Filipino animation studio Top Draw that produces 250 half hours of 2D animations each year. GromSocial is a social media network that operates for kids under 13. They can upload videos and post messages and watch TV shows in their account on the app. Looking ahead, this will become the bread and butter of the company.
Some might argue that since Grom Social is not directly connected to Trump, it cannot make it on a list of Trump stocks. However, alternative social media is one of the major investment themes emerging from the DWAC announcement. Hence, GROM will also do very well.
Phunware (PHUN)
The world of marketing and advertising has changed dramatically in recent years, with more people turning their attention towards technology. Nowadays, you can find an app for just about anything, from finding your favorite music player or even tracking down the nearest gas station. One such company is Phunware; they specialize in creating mobile applications which allow brands to create personalized ad targeting programs so that advertisers know what content will be most appealing when it comes time to advertise products through these means.
During the 2020 presidential election, Phunware joined hands with American Made Media Consultants for “the development, launch and ongoing management and evolution of the Trump-Pence 2020 Reelection Campaign’s mobile application portfolio on Apple iOS and Google Android smartphones.” We do not have any clarity on whether Phunware will have any hand in developing the Truth Social app. However, due to Trump’s prior connection and sponsorship, investors are likely going be excited about DWAC as it unfolds.
The Trump campaign did not succeed. But Phunware’s data and its systems still have multiple use cases. For instance, they could prime their base before an election by fundraising or fanning Trump’s supporters into a frenzy on social media platforms – all with little effort. Therefore, Phunware’s association with Trump may not be over.
On the publication date, Faizan Farooque 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.
Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. You can check out his analysis on InvestorPlace and TipRanks.