Over the past few weeks, former President Donald J. Trump has become a lot richer, and so have shareholders in the social media company that bears his name.
Shares of Trump Media & Technology have nearly tripled in value since bottoming out in late September, a week after a rule expired that prevented some early investors, including Mr. Trump, from selling tens of millions of shares.
The stock of the parent company of Truth Social jumped about 10 percent on Tuesday, on top of Monday’s 18 percent gain.
Over the past few weeks, the surge has added about $2 billion to the value of Mr. Trump’s nearly 60 percent stake in the company. The former president’s 115-million-share stake is now worth about $3.8 billion.
Ever since Trump Media became a public company in March, its stock has been on a roller-coaster ride, rising and falling often in sync with the perceived odds of Mr. Trump’s chances of victory in the presidential election.
Most public opinion polls show the race between Mr. Trump and Vice President Kamala Harris to be neck and neck. But the betting and prediction markets — which are influenced by traders and crypto speculators — have recently shown Mr. Trump taking a decisive lead.
One of the more popular prediction sites, Polymarket, has Mr. Trump ahead of Ms. Harris by a margin of 57 percent to 43 percent. Polymarket is a favorite platform for crypto traders, and has raised tens of millions of dollars from Peter Thiel’s Founders Fund. Mr. Thiel, a Silicon Valley billionaire, has backed a number of conservative candidates in recent years, including Senator JD Vance, Mr. Trump’s running mate.
“This stock has never traded on fundamentals, but is a barometer for both Trump and Trump’s followers,” said Kristi Marvin, a former investment banker and founder of SPACInsider, which collects data about special purpose acquisition companies (a type of shell company, like the one that merged with Trump Media in March to give it a public listing). “And in the same way people can now bet on Trump and the election on sites like Polymarket, people can also bet on Trump via the stock market.”
Mr. Trump is neither an officer nor a director in Trump Media, but he is a prolific poster on Truth Social and the platform’s main draw.
Given the volatility of Trump Media’s shares, it’s hard to know exactly what is moving its price from day to day.
Mr. Trump’s decision not to sell any shares after a six-month lockup period could have been seen by some investors as bullish. The lockup provision expired on Sept. 19.
The fact that the company is losing tens of millions of dollars each quarter and is taking in little advertising revenue has not appeared to phase investors. The company carries a market valuation of more than $6 billion, putting it on par with companies like the toymaker Mattel and the department store chain Dillards.
Trading in Trump Media has been frenetic of late, with tens of millions of shares changing hands each day. A majority of the company’s more than 600,000 shareholders are thought to be individual investors, many of them fans of the former president and posters on Truth Social.
Even after the recent surge in Trump Media shares, the company is worth only about half as much as its record high. The stock hit that peak days after it completed its merger with the cash company, a deal that brought Trump Media more than $300 million in cash.
It remains unclear how Trump Media will use that cash, beyond rolling out a video streaming service to supplement the Truth Social platform. The company has yet to hold an investor or analyst call.
The post Trump Media Stock Surges, Nearly Tripling in Matter of Weeks appeared first on New York Times.
