Investors in Trump Media & Technology Group’s stock are finally seeing an uptick in their shares after a tumultuous week. The stock TMTG (DJT) rebounded by 20% in early afternoon trading on Wednesday, after falling earlier this week. Shares closed more than 14% lower on Tuesday following the company’s premier product, Truth Social, announcing a major expansion into streaming, a costly business. It also fell 18% on Monday after the company took steps to sell millions of extra shares.
Despite the recent volatility, Trump Media has been struggling to make money and needs cash. The company is majority-owned by former President Donald Trump and his name recognition, politically polarizing nature, and close association with the company have drawn attention from investors, traders, and the news media. However, the company lacks the fundamentals to back up its high valuation and investors should be cautious.
Trump Media lost $58 million in 2023 and made only $4.1 million in revenue, leading to extreme swings in the net worth of former President Trump, who serves as the company’s largest shareholder and chairman. On one particularly bad day, Trump’s net worth plunged by $1 billion. He is currently facing a criminal trial on 34 felony counts of falsifying business records for his alleged role in a hush money scheme before the 2016 election to which he has pleaded not guilty.
