Shares of Trump Media saw a significant increase of nearly 19% on Tuesday, marking the fourth consecutive day of gains for the Truth Social operator. The stock price for DJT jumped to $22 in heavy trading, almost 90% higher than its recent low of $11.75 per share. However, this price remains below the peak it reached in late March at $79.38. The trading volume for DJT shares tripled on Tuesday, exceeding its 30-day average volume.
The recent surge in Trump Media’s stock price accelerated after Donald Trump held a campaign rally near Butler, Pennsylvania, where he had survived an assassination attempt in July. The event drew thousands of supporters, including Elon Musk, who endorsed Trump’s candidacy. Musk, the CEO of Tesla and owner of the social media site X, voiced his support for Trump to preserve democracy in America. Despite positive momentum, concerns arose when the company announced the resignation of its COO, Andrew Northwall, without further explanation. The departure of other key employees and a stock agreement breach with ARC Global Investments II also raised questions about the company’s stability.
Recent filings with the Securities and Exchange Commission revealed that Trump Media handed over a substantial amount of common stock to ARC Global Investments II, following a legal ruling that the company had breached a stock agreement. Co-founders of Trump Media also sold off a significant portion of their stake in late September, shortly after early investors were allowed to sell shares. Trump, who owns nearly 57% of Trump Media, has a stake worth almost $2.5 billion as of Tuesday and has pledged not to sell his shares. Despite significant net losses and minimal revenue, Trump Media maintains a market capitalization of over $4 billion.
Analysts speculate that investing in Trump Media may be a way for retail investors to show support for Trump or place bets on his chances of winning the upcoming election against Democratic presidential nominee Kamala Harris. Despite its lack of profitability and smaller audience compared to other social media giants like X and Facebook, the company’s stock price continues to climb. Trump Media’s Chief Product Officer, Sandro de Moraes, also left the company, as reported on his Truth Social account. ProPublica noted multiple lower-level employee departures from Trump Media, adding to concerns about the company’s stability amidst recent leadership changes.
The rally in Trump Media’s stock price has persisted, with the share price reaching $21.80 at the close of trading on Tuesday. The company’s majority owner, Donald Trump, has been a driving force behind the recent price increase, with his return to the campaign trail drawing significant support. Despite challenges such as key executive departures and legal disputes, Trump Media continues to attract investor interest and support, with Trump’s significant stake in the company adding to its appeal. As the company navigates these obstacles, its trajectory in the stock market remains closely tied to Trump’s political future and the upcoming election.
