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Trump Media shares rise 10% after debate

Jaap Arriens/NurPhoto/Getty Images

This photo illustration shows the social app Truth on a mobile device.



CNN

Former President Donald Trump’s social media company is getting a boost after President Joe Biden’s shaky debate performance.

Shares of Trump Media & Technology Group (DJT), owner of Truth Social, rose 4% in early trading Friday as investors bet that the debate has boosted Trump’s chances of retaking the White House.

Trump is chairman of Trump Media and its largest shareholder. He is also Truth Social’s most popular user. The company’s sticker symbol even reads “DJT,” a nod to the former president’s initials.

The stock has been volatile for a number of reasons, including a transaction that allowed investors to buy additional shares, diluting other shareholders’ holdings.

Trump Media doesn’t really trade based on the fundamentals of the underlying company. The stock has fluctuated with news about Donald Trump, including his criminal conviction and his performance at Thursday night’s debate. Some critics have viewed the stock as a way to fund Trump’s presidential campaign. Other investors believe the company’s long-term success depends on Trump’s re-election chances.

“DJT is essentially a proxy for Trump’s election victory,” Matthew Tuttle, CEO of Tuttle Capital Management, told CNN on Friday.

Trump Media is valued at more than $6 billion, even though the company has very little revenue and Truth Social is tiny.

However, analysts say Trump Media’s share price will rise in part because of the idea that Truth Social could become the president’s primary communications platform if Trump wins the election.

Tuttle said that amid talk among Democrats of Biden’s resignation, money is flowing into Trump Media stock, and some of the president’s allies are not even trying to “play it out.”

As of current trading on Friday morning, that stake is worth $4.6 billion, up from $4.2 billion at the close on Thursday.

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