Investors in Trump Media & Technology Group’s stock finally saw an uptick in their shares after two days of turmoil. The stock TMTG (DJT) rebounded by 15.6% on Wednesday after tumbling precipitously earlier this week.
Shares closed more than 14% lower on Tuesday after the company’s premier product, Truth Social, announced a major expansion into streaming, a notoriously cost-intensive business in which media behemoths like Disney have struggled to turn a profit. It also fell 18% on Monday after the company took steps to sell millions of extra shares.
The company, majority-owned by former President Donald Trump, is down more than 60% from the all-time high it set on March 26, the day after it merged with a blank-check acquisition company to go public. The company’s market value as of Wednesday’s close was $3.6 billion, well below its peak of $8 billion when the company began trading at nearly $70 a share.
The Price of Fame
Trump Media shares have been volatile due to the company's association with the former president. His name recognition, politically polarizing nature, and close ties to the company have attracted attention from investors, traders, and the media, leading to stock volatility.
Despite being worth billions, the company is struggling financially and requires cash. Experts caution investors about trading the stock due to its inflated valuation without strong fundamentals. Trump Media reported a loss of $58 million in 2023 and generated only $4.1 million in revenue.
Extreme Turbulence
Trump Media’s stock fluctuations have impacted the net worth of its largest shareholder and chairman, former President Donald Trump. On a particularly bad day, Trump's net worth dropped by $1 billion.
Trump is currently facing a criminal trial with 34 felony counts related to falsifying business records in an alleged hush money scheme before the 2016 election. Trump has pleaded not guilty.
