Donald Trump’s media companies are enjoying a resurgence in the stock market, with Trump Media & Technology Group on Tuesday as betting markets favor the former president’s victory in the Nov. 5 election. ‘s stock price is soaring.
The attention on Trump Media, which trades under the ticker DJT, which shares Mr. Trump’s initials, has led to a surge in trading volume, and on Tuesday, the New York Stock Exchange suspended trading in the stock several times due to unusual volatility.
Shares rose $5.86, or 12.4%, to $53.22 in Tuesday afternoon trading. The increase represents a sizable windfall for President Trump, who owns more than 57% of Trump Media shares, according to investment research firm S3 Partners, and the current share price increase has increased the value of his stock by $2.6 billion to 60%. It is said to have amounted to more than a billion dollars.
Since hitting a low of $11.75 per share in September, the stock has risen more than 340%. Tuesday’s surge came as the Nasdaq Composite Exchange, where Trump Media shares are traded, rose 0.9%, staying on track to end the day at a record high.
Although polls show the presidential race to be extremely close, betting markets such as Polymarket are currently predicting that Trump is favored to win the election.
“DJT’s price is a good reflection of President Trump’s chances in prediction markets,” S3 analysts said in a note to investors on Tuesday.
Polymarket announced last week that a French retail trader was behind four accounts that spent millions of dollars buying contracts with President Trump, but the international platform determined this was not market manipulation. .
More valuable than Elon Musk’s X
Trump Media’s stock price has been volatile since it began trading in March, initially soaring to a valuation of more than $9 billion despite a history of losses, but then falling to September lows. Much of the stock’s movement is tied to Trump’s political fortunes, with DJT rising when Trump’s odds appear to be improving.
Trump Media’s market capitalization now stands at $10.3 billion following Tuesday’s stock rally. That outpaces established social media platforms, including X (formerly Twitter), and is valued at about $9.4 billion based on value investment firm Fidelity, the latest to allocate a stake in the company.
DJT stock’s wild swings are prompting comparisons to meme stocks, or companies whose stock trades are trending on social media, rather than traditional metrics such as revenue growth or profitability. Trading volume in DJT stock has been unusually high over the past two weeks, with Tuesday’s volume exceeding 120 million shares and the 30-day average volume exceeding 35 million shares, according to financial data firm FactSet.
“DJT is extremely volatile due to momentum speculators,” Jay Ritter, a finance professor at the University of Florida, wrote in an email to CBS MoneyWatch. “These speculators buy when prices rise, pushing prices up, but sell when the tide turns, sometimes leading to large declines.”
DJT price prediction
But Ritter said Trump Media has little revenue or growth to attract institutional investors, and the cost of borrowing the stock makes it expensive to short sell.
He added: “The company is losing money and burning through cash. We don’t know what will happen to prices in the short term, but the long-term trend will be down.”
The company’s shaky financial condition has invited short sellers, investors who bet that a company’s stock price will fall, to buy into DJT stock. And these shorts, which Trump media executives have accused of manipulating the company’s stock, could be in the bath if Trump wins next week, according to S3.
In contrast, “DJT could become worthless if Trump loses,” the analysts wrote.
The Associated Press contributed to this report.
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