'Neutrality As A Service': How This Analyst Says Rumble Could Win The Social Media, Video Market

Zinger Key Points
  • An analyst is initiating coverage on free speech video platform Rumble ahead of its SPAC merger.
  • The analyst sees a need for a neutral platform and sees revenue growth coming from adding content creators and monetization.
'Neutrality As A Service': How This Analyst Says Rumble Could Win The Social Media, Video Market

Ahead of its pending merger with CF Acquisition Corp VI CFVI, an analyst is calling out Rumble's offering of “neutrality-as-a-service.”

The Rumble Analyst: D.A Davidson analyst Tom Forte initiated coverage on Rumble with a Buy rating and $15 price target.

Related Link: Neutral Video Platform Rumble Going Public Via SPAC: What Investors Should Know And Its Connection To Donald Trump 

The Rumble Takeaways: Rumble offers a platform for users to share videos utilizing a free-to-use service. Rumble centers on being neutral with a focus on free speech, in opposition to other social media platforms that have banned users.

“Rumble differentiates itself from social-networking platforms like Twitter and YouTube with its commitment to operating with consistent and creator-friendly standards of conduct and content restrictions to build trust within its community of creators,” Forte said of the comparisons to Twitter Inc TWTR and Alphabet Inc GOOG GOOGL-owned YouTube.

The analyst predicts that Rumble could grow its revenue at an average annual rate of 119.1% from 2021 to 2024.

“We believe social, mobile OTT, and co-operation with Amazon are the most important to the company.”

Forte sees a large audience on Rumble that could further monetize. The company can also continue to add additional content creators.

“Rumble’s differentiated strategy could result in a greater than expected number of content creators joining its platform, which could have a positive impact on engagement and monetization.”

International expansion is also a key for Forte’s thesis on the stock, with Rumble working to expand to new territories like Australia, Canada, France, Italy and the United Kingdom.

Content generated by users for Rumble could make the company stronger than online peers like newspapers that have to pay for content, the analyst said. 

“User-generated content is free.”

Forte sees a need for neutrality in the social media space, with Rumble standing out.

“Rumble aims to be that company and is one reason we are bullish on it and its stock.”

Appealing to both sides of the political spectrum and also attracting politicians on its platform could benefit Rumble's long-term growth, he said. 

Shareholders of CF Acquisition Corp VI will vote on the merger with Rumble next week.

CFVI Price Action: CF Acquisition Corp VI shares lost 2.36% Friday, closing at $11.98. Shares have traded between $9.67 and $18.52 over the last 52 weeks.

Photo via Shutterstock. 

Posted In: D.A. DavidsonFree SpeechRumbleSocial Media Platformssocial media stocksSPACsTom ForteYouTubeAnalyst ColorM&ANewsSocial MediaPrice TargetInitiationSmall CapIPOsAnalyst RatingsTrading IdeasGeneral