RUM stocks are poised to rise or growth has peaked

Video sharing platform Rumble Inc. NASDAQ: RUM released its fourth-quarter 2023 earnings report with less-than-stellar results. Highlights included increased daily active users and an EPS beat of 8 cents, with losses of 14 cents versus 22 cents. However, the good news was offset by a reduction in the number of average minutes watched per active user and a large loss of revenue. Shares of the consumer discretionary company initially sold off on the news but managed to recover. The Rumble CEO stated that revenues will accelerate on a sequential basis due to various monetization efforts initiated in the quarter.

A free speech alternative to YouTube?

Rumble considers itself the alternative to Alphabet Inc. NASDAQ:GOOG owned YouTube, Vimeo Inc. NASDAQ: VMEO and other popular video sharing platforms. The ideology of uncensored free speech has attracted both right-wing conservatives and critics. His stock price was also matched by news about former President Donald Trump and his media company, Trump Media & Technology Group Co. NASDAQ: DJT price action. Rumble was the exclusive live streaming platform for the fourth debate of the Republican presidential primaries.

Q4 2023 earnings breakdowns

Rumble reported a fourth-quarter 2023 EPS loss of 14 cents versus a loss of 22 cents, a beat of 8 cents. Revenue increased 2.2% year-over-year to $20.39 million, below consensus estimates of $28.13 million. Monthly active users (MAU) increased 16% sequentially to 67 million, including 48 million in the US and Canada. The estimated average minutes watched per month (MWPM) was 10.5 billion, down from 10.7 billion in the same period a year ago. This figure was derived from bandwidth consumption metrics. Hours of video uploaded per day increased 21% to 12,520, compared to 10,373 in the same period a year ago. The company ended the quarter with $219.5 million in cash and cash equivalents.

Revenue drivers are positioned to increase in the second quarter of 2024

The company said that starting in the second quarter of 2024, it expects revenue to increase sequentially as its revenue engines come online. Its previous guaranteed creator commitments, in which it hired popular content creators to generate content, are set to taper significantly through the end of 2024 and into 2025.

CEO Insights

Rumble CEO Chris Pavlovski reiterated that 2023 was the company’s build year. This includes successfully diversifying its content library and signing key content providers across the comedy, entertainment and sports sectors. The company has launched a redesigned user interface across all platforms. Rumble has integrated a premium subscription service, locals.com, giving content creators stronger monetization opportunities.

2023 was a year of milestones

Rumble has launched the beta version of Rumble Studio, which includes its patent-pending live streaming tool, which will lay the future foundation for monetization. The Rumble Advertising Center (RAC) launched within the last 90 days. It is rolling out pre-roll video ads on its mobile apps. The company is hiring new editors and expanding its inventory. The company also launched Rumble Cloud just two weeks ago. The revamped user interface and integration of a video platform, an ad network, a new live streaming tool and a cloud in just one year.

Rumble Studio allows content creators to live stream videos to multiple platforms such as YouTube, Amazon.com Inc. NASDAQ: AMZN, owned Twitch, Kick, X and Meta Platform Inc. NASDAQ: METAand Facebook and invite guests to interact with viewers.

A mini Google created by less than 250 people

Pavlovski compared the 2023 milestones alongside Google’s as the company built its 4 key products and monetization drivers. Pavlovski commented: “What we have built is essentially a mini Google.”

He continued: “Google bought DoubleClick for $3 billion, compared to Rumble Advertising Center. Google bought YouTube for $1.65 billion in 2006, compared to the Rumble Video platform. Google also invested billions in Google Cloud, compared at our Rumble Cloud. And by the way, we did all of this with less than 250 people.”

Rumble analyst ratings and price targets I’m on MarketBeat. Rumble contestants and competitor actions can be found with MarketBeat Stock Screener. RUM has a short interest of 15%.

Daily ascending triangle pattern

The daily candlestick chart for RUM illustrates a daily ascending triangle pattern. The ascending trend line formed at $6.22 on February 28, 2024. The lower trend line formed as higher highs on pullbacks met resistance at the flat upper trend line at $8.94. The daily relative strength index (RSI) has moved back to the 57 band, but may end up making another rebound attempt to challenge the flat upper trendline as RUM approaches the apex point where the upper and lower trendlines they meet. The pullback support levels are at $7.40, $6.76, $6.22, and $5.82.

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