**Rumble and Trump Media (DJT) Stocks Experience Surge Amid Election Developments**
This week, shares of Rumble (RUM) and Trump Media & Technology (DJT) saw significant gains driven by recent election-related events.
**Key Developments:**
- **Rumble’s Surge & VP Pick:** Rumble's stock surged over 20% after news broke that Donald Trump was shot and subsequently announced JD Vance as his vice-presidential choice. Vance, along with Peter Thiel, are notable investors in Rumble, adding weight to this development.
- Election Odds & Market Reactions: Investor confidence rose following an assassination attempt on Trump in Pennsylvania and his strong debate performance against Joe Biden. Betting markets now favor Trump’s chances if he faces Biden in the election. However, if Biden withdraws, Democratic figures like Kamala Harris, Gretchen Whitmer, and Gavin Newsom might step in, adding to the speculation driving interest in DJT and RUM stocks.
Truth Social Engagement:** A potential Trump victory could significantly increase engagement on Truth Social, positioning it as a strong competitor to platforms like X and Gab.
Risks Facing RUM & DJT Stocks:
- **Advertising Challenges:** Both Rumble and Trump Media face difficulties in attracting mainstream advertisers, such as Amazon, AT&T, and Walmart, which raises concerns about their revenue sustainability.
Cash Burn & Future Dilution:Both companies are experiencing rapid cash burn. Rumble reported a Q1 net loss of $43.3 million with $183 million in cash, while Trump Media reported a loss of over $327 million, ending with $233 million. This financial strain suggests they may need to raise significant capital soon.
Competitive & Valuation Challenges: Rumble faces stiff competition from YouTube, which had 95.6 billion visits in Q2 compared to Rumble's 351.8 million. Trump Media also contends with platforms like X and Reddit, with DJT’s market cap at $7.7 billion against Reddit’s $10 billion and X’s $19 billion.
