Stock market: Trump Media's stock plummets heavily!

The initial enthusiasm sparked by DJT, the stock of Trump Media & Technology Group among traders and investors, might have been just a temporary syndrome? The stock was supposed to ride on the success of Truth Social. Unfortunately, less than a month after its launch on March 26th, DJT has completely cooled off. Associated with the image of Donald Trump, does the stock only depend on a possible legal victory of the former president?

DJT: the stock hits an all-time low in a few weeks

Entering the Nasdaq stock exchange on March 26th, DJT stock of Trump Media & Technology Group promised to become a financial phenomenon. In the week it joined the Nasdaq, its price reached $79.38, with a market capitalization fluctuating between $8.9 and $11 billion.

However, according to experts like John Rekenthaler, “investing in Trump Media is an act of faith”, because “investing in a company tied to a celebrity carries certain risks”. Indeed, as soon as the first criminal trial against Donald Trump opened in New York, DJT reached its all-time low of $22.25. Worse, almost all the circulating DJT shares, except those held by insiders, have already been resold.

Last Wednesday, the market value of the stock rose to $27.27, pushing its market capitalization from $3.2 to $3.7 billion. The reason? The day before, Trump Media had announced the creation of a video streaming platform. Unfortunately, the news only had a short-lived effect. At the close of the market, DJT had dropped back down to $26.60.

Trump has 78 million shares in $DJT which means in the last two weeks he has lost $2.6 billion… pic.twitter.com/xjyBGiM73M

— Tarquin 🇺🇦 (@Tarquin_Helmet) April 11, 2024

Do Trump Media’s annual results reflect on the DJT stock price?

Just like Elon Musk for Tesla, Donald Trump’s image could have given DJT stock great success. Unfortunately, the publication by Trump Media of its results for the years 2022 and 2023 really did not play in its favor.

In fact, according to the regulatory documents published, Trump Media recorded an operating loss of 16 million dollars in 2023. Its interest expenses are 39.4 million dollars, nearly 10 times its revenue of 4.1 million dollars. The trend was similar in 2022. The ongoing trial against the former US president is therefore not the only factor affecting DJT.

Should we hope that a possible legal victory for Donald Trump, and possibly his election, will boost DJT’s stock price? In any case, as the experts say, investing in DJT is truly an act of faith.