What happened

Shares of digital media and marketing company Gannett (GCI) are trading sharply higher on Friday, but there's no clear catalyst to explain the move. Usual stock-moving factors like earnings reports, analyst calls, and short squeezes aren't in play here.

Nevertheless, Gannett stock is up 14% as of 1:00 p.m. EDT.

A businessman rides a rocket ship expelling cash exhaust over a multicolored bar chart.

Image source: Getty Images.

So what

Gannett owns big media assets like the USA TODAY newspaper. However, it also operates an advertising business under its LOCALiQ brand. LOCALiQ recently partnered with the PGA Tour to create an eight-tournament series starting in August. The PGA Tour isn't currently allowing spectators at its golf events, but it just announced it will allow up to 50 guests per day at some upcoming events.

This is barely positive news, and the connection to Gannett is too thin to believe this is truly what's moving this stock today. In reality, this may just be a case of traders flocking to a small-cap stock with low average trading volume and a low price per share. This kind of stock is easiest to manipulate for a short-term gain.

Now what

When investing in stocks, it's best to take a long-term approach and be willing to hold for years. With Gannett stock, investors need to be careful. If it's truly short-term traders making a quick buck, expect shares to fall again in the near term after they've had their fun.

I'm not suggesting Gannett doesn't have value. The company merged with New Media in late 2019 and unveiled a plan that could unlock significant value. Through the combined financial resources, it intends to aggressively pay down debt over the next three years. This could allow the company to generate $500 million in annual free cash flow by then.

That's a ton for a company Gannett's size. Therefore, shareholders should monitor the company's progress against this goal in coming quarters. But as long as the stock sits in small-cap territory, be prepared for volatility.