Trump Media Stock Soars as President-Elect Holds Tight to Shares
The value of Trump Media & Technology Group (DJT) surged in premarket trading on Monday, jumping as high as 7% after a 15% spike on Friday. This sudden boost follows Donald Trump’s announcement on his Truth Social account that he will retain his shares in the company.
A Significant Stake
As the parent company of Truth Social, DJT boasts a market capitalization of approximately $7 billion, with Trump maintaining a substantial 60% interest. At Friday’s closing price of around $32 per share, Trump’s stake is valued at roughly $4.2 billion.
A Turbulent Ride
Since Trump’s presidential election victory over Kamala Harris, DJT shares have experienced extreme volatility, fluctuating between highs and lows. In September, the stock hit its lowest point since its debut, following the expiration of its highly publicized lockup period. However, as domestic and international betting markets began to favor a Trump win, the stock rebounded from its lows.
The Birth of Truth Social
Trump founded Truth Social after being banned from major social media platforms like Facebook (META) and Twitter, now X, in the wake of the January 6, 2021, Capitol riots. Although he has since been reinstated on these platforms, Trump officially returned to posting on X in mid-August after a year-long hiatus.
Fundamental Concerns
As Truth Social attempts to challenge established social media players, questions have long surrounded the company’s fundamentals. On Tuesday, just hours before the election polls closed, DJT released its third-quarter results, revealing a net loss of $19.25 million for the quarter ending September 30. While this figure represents a narrower loss compared to the $26.03 million reported in the same period last year, it still raises concerns.
Revenue Takes a Hit
DJT also reported revenue of $1.01 million, a slight year-over-year decline from the $1.07 million reported in the third quarter of 2023. Over the past nine months ending September 30, revenue has dropped 23% from the prior-year period, sparking concerns about the company’s long-term viability.
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