Shares of the major multimedia company Salem Media (SALM) have been surging in price lately on investor enthusiasm surrounding former President Trump’s announcement that he plans to build a new social media platform and SALM’s ties with the former President. However, given the company’s poor profitability and inability to generate better cash flows, will the company be able to sustain its stock’s price rally? Read on to learn more.Leading multimedia company Salem Media Group inc. (SALM) in Camarillo, Calif., specializes in Christian and conservative content, with media properties that comprise radio, digital media, and book and newsletter publishing. In addition, the company issues digital newsletters with market research and non-individualized investing recommendations.
On the heels of former President Donald Trump’s announcement that he proposes to build a new social media platform called Truth Social, SALM’s stock has surged 113.7% in price over the last three months and 42.7% over the past month. Dr. Sebastian Gorka, one of SALM’s former network hosts, was appointed to President Trump’s National Security Education Board last year. Given the company’s ties with the former President, the stock witnessed a tidal wave of bullishness.
However, we think the company’s poor profitability and financial instability could impact the stock’s momentum in the near term.