Fastly Stock Jumped 11% on Monday

What happened

Shares of cloud computing specialist Fastly (NYSE: FSLY) jumped on Monday, rising as much as 12.7%. By the time the market closed, the stock was up 11%.

The gain comes despite the fact there was no company-specific news on Monday. The move highlights a continuing trend of significant volatility for the tech stock since its initial public offering earlier this year.

Image source: Getty Images.

So what

Fastly stock’s sharp gain on Monday could — at least in part — simply represent a rebound from a sharp decline on Friday. Shares were slammed on Friday amid a broader-market decline that hit high-growth stocks particularly hard.

But 10%-plus one-day rises and declines are not out of the norm for this stock. One prominent argument explaining the stock’s recent volatility is that an investment firm’s aggressive purchases of Fastly stock following its IPO have reduced float significantly, leading to more volatile trading.

Now what

Investors shouldn’t give too much weight to near-term swings in the prices of growth stocks, particularly when they come at times when there is no company news. Instead, investors should remain focused on the underlying fundamentals of the stocks they own.

10 stocks we like better than Fastly
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has quadrupled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now… and Fastly wasn’t one of them! That’s right — they think these 10 stocks are even better buys.

See the 10 stocks

*Stock Advisor returns as of June 1, 2019

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Fastly. The Motley Fool has a disclosure policy.

You May Also Like

About the Author: Over 50 Finance