'Trump And Dump' Scenarios As The Post-Election Rally Fades

What does Donald Trump mean for Internet stocks? How will his ideas for modifications to immigration, regulatory, trade, and tax policies impact on the sector?

Loop Capital Markets’ Blake Harper said companies facing the largest risk in the expected backdrop of restrictive trade and antitrust policies are those expanding internationally, and those with a large chunk of international revenues and diverse operations.

On the other hand, those Internet businesses with a focus on U.S. markets should be immune.

Consequently, the firm thinks larger Internet companies with extensive international exposure could face some near-term headwinds, while smaller, local online marketplaces “could benefit from more positive sentiment and see stronger performance.”

Some companies with large international revenues are:

• Amazon.com, Inc. AMZN
• Alphabet Inc GOOGL GOOG
• Facebook Inc FB
• Shutterstock Inc SSTK
• Twitter Inc TWTR
• Groupon Inc GRPN, although this could change in the future.

The latter group includes:

• Angie's List Inc ANGI
• Care.com Inc CRCM
• GrubHub Inc GRUB
• Quotient Technology Inc QUOT
• Bankrate Inc RATE
• Lendingtree Inc TREE
• TrueCar Inc TRUE
• Yelp Inc YELP

Longer Term

Having said this, Loop Capital analysts believe the changes that will come with a Trump presidency shouldn't alter the “longer term, secular trends at work in the Internet industry.”

In their opinion, “this election speaks to the power of social media and the ability to influence people via social media is unquestioned.”