As a movie buff who has seen more than a few financial thrillers, I must say that the story unfolding with Trump Media & Technology Group (TMTG) is starting to feel like one of those high-stakes dramas where a small company’s stock skyrockets on the eve of a major event. The fact that TMTG’s market cap is almost at par with Elon Musk’s X, formerly known as Twitter, is nothing short of astonishing, especially given its reported losses and modest revenue.
The Trump Media & Technology Group, responsible for the Truth Social social network, has witnessed a significant increase in its stock value during the weeks preceding the November 5 presidential election. At present, it’s nearly equivalent in worth to X (the previous name of Elon Musk’s social media company, Twitter).
On Monday, shares of TMTG, which trade under the symbol “DJT,” were up 16.5% to $45.39/share as of 11:15 a.m. ET, following Trump’s Sunday rally at New York City’s Madison Square Garden. That gives TMTG, which has reported total revenue of $1.6 million for the first half of 2024 and steep losses, a market cap of about $9.1 billion.
Elon Musk, who bought Twitter in 2022 for a whopping $44 billion, has observed a substantial drop in the value of the company (renamed as X) since his acquisition. Recently, Fidelity, one of the shareholders with a minority stake in X, disclosed a valuation of approximately $9.4 billion, according to Forbes.
As a film enthusiast, I’m proud to say that I hold over half (56.6%) of the exceptional shares of TMTG, which means my current stake is valued at more than $5 billion. It’s an exciting time for this media giant!
As a fervent admirer, I find myself in agreement with industry analysts who attribute the recent surge in TMTG’s stock price to a burgeoning optimism among its investors. The belief here is that Trump, not VP Kamala Harris, might emerge victorious in the 2024 presidential election. Gene Munster, managing partner at Deepwater Asset Management, aptly expressed this phenomenon to CNN in an article published Monday: “I’ve rarely encountered anything quite like this. The value of this company is almost entirely contingent on the result of an upcoming election.
Musk, currently the wealthiest person globally, serves as both CEO of Tesla and SpaceX. On Sunday, he appeared as a prominent speaker at Trump’s event held at Madison Square Garden.
On September 23, TMTG’s share price reached its lowest point at $12.15 due to the conclusion of a six-month restriction that prevented TMTG insiders from selling their stocks. However, Trump has made it clear that he has no plans whatsoever to offload his shares in the company.
In the second quarter of 2024, TMTG reported a net income of $836,900 and a net loss of $16.37 million. This financial performance does not seem to explain the recent significant surge in its stock price. For Q1, the company announced $770,500 in revenue and a net loss of $327.6 million. A large portion of this loss was due to expenses related to TMTG’s merger with Digital World Acquisition Corp., which took place to transition the company into a publicly traded entity. However, these financial figures do not appear to be the cause behind the stock’s recent rally.
Truth Social, managed by TMTG, is described as a refuge for open dialogue, given the growing suppression of free speech by major tech companies. Trump established TMTG last year following his ban from Twitter (previously known as X), Facebook, Instagram, YouTube, and other internet services, which claimed that he had breached rules against inciting violence in relation to the January 6, 2021 assault on the U.S. Capitol.
After finalizing the Twitter acquisition, Elon Musk swiftly reactivated Donald Trump’s account on X. Similarly, Trump’s access was restored to Facebook and Instagram owned by Meta, YouTube, and other platforms. Yet, Truth Social continues to be his favored social media choice.
As a film enthusiast, I find myself intrigued by the debut of Truth Social in the early months of 2022. Unlike many platforms, they’ve chosen an unconventional route when it comes to discussing user statistics. In their latest filing, they mentioned that they’re deliberately steering clear of typical performance metrics such as sign-ups, average revenue per user, ad impressions, and pricing, or active user accounts like monthly and daily active users. Instead, they believe that focusing on these traditional key indicators might distract them from evaluating their business growth strategically.
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2024-10-28 18:17