Trump Media & Technology Group, the owner of struggling social media platform Truth Social, is began its long-delayed journey as a public company at Tuesday’s opening bell under the ticker symbol “DJT.”
The stock surged about 56% at the open, to $78, and trading was briefly halted for volatility. Trump Media shares have since stabilized at around $70, marking a 40% increase from Monday’s close.
Wall Street is assigning Trump Media an eye-popping valuation of around $13 billion — a price tag that experts warn is untethered to reality.
The skyrocketing share price comes despite the fact that Trump Media is burning through cash; piling up losses; and its main product, Truth Social, is losing users.
“This is a very unusual situation. The stock is pretty much divorced from fundamentals,” said Jay Ritter, a finance professor at the University of Florida’s Warrington College of Business, who has been studying initial public offerings (IPOs) for over 40 years.
Maybe this is worded funny, but you’re close. You sell it for it’s price today and then buy the same amount in the future for whatever it ends up being worth.
Shorting highly volatile securities is way more risky than shorting established low risk stocks. You could be on the hook for way more money than you’re able to pay back and since the value of DJT right now is completely unhinged it’s not subject to predictable market forces, industry trends, or conventional wisdom. It could go up to double, WSB could try a short squeeze, who knows.