To bolster his presidential ambitions and address ongoing legal battles, former President and presidential candidate Donald Trump opted to launch his social media platform, Truth Social, to the public.
Following its initial public offering (IPO) and being branded as Trump Media & Technology Group (NASDAQ: DJT), the platform amassed over 5 million active monthly users and generated billions in revenue for Trump.
DJT stock had settled on a valuation of $57.99 at the market close on March 27. Notably, it showed substantial gains in pre-market trading, rising by 13.73% for a current valuation of $65.95.
The spike in DJT stock value generated billions for Trump
When DJT stock debuted on the market and began trading, it quickly surged by over 55% on its first day. This significant increase meant that DJT shares had risen by more than 100% over the past five days and an astonishing 375% throughout the year.
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Consequently, this surge propelled Trump’s net worth to $6.5 billion, elevating him into the ranks of the top 500 wealthiest individuals.
Truth Social, a platform under Trump Media, generated only $3.3 million in revenue during the first nine months of last year while incurring a loss of nearly $50 million.
Why is DJT stock performance important for Trump?
This launch is crucial for Donald Trump, who is in need of funds to settle legal penalties and owns more than half of the company’s shares. However, he is unable to sell his shares for at least six months, limiting his immediate access to funds.
If Trump were to sell a substantial portion of his shares, it could negatively impact the share price. Investors also face risks linked to Trump’s political fortunes and his potential 2024 presidential campaign. While a loss could dampen the DJT share price, a win could potentially boost it.
It’s worth noting that interest in Trump Media has been driven largely by individual investors, many of whom appear to be Trump supporters, rather than by traditional Wall Street firms. These individual investors tend to base their interest more on personal allegiance rather than on the financial performance metrics typically used by institutional investors to assess intrinsic value.
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