Former President Donald Trump’s “truths” – the Twitter (NYSE:TWTR) equivalent of “tweets” he’s finally starting to post on his Truth Social platform – don’t appear to be enough to move the needle on Digital World Acquisition Corp. (NASDAQ:DWAC) stock.
In fact, shares in the special purpose acquisition company (SPAC) are pretty much back to where they were before the former president made his long-awaited return to Truth Social.
The chart tells the story. DWAC stock was trading at roughly $47 in mid-April, before Elon Musk disclosed his interest in Twitter. DWAC dropped all the way to $35 as investors got excited about Musk’s involvement in Twitter and began predicting that he would lift Trump’s ban from the platform.
That’s when Trump started – after months of inactivity – to make some posts of his own on Truth Social. DWAC stock jumped all the way to $52 on April 29.
But the excitement was short-lived and now Digital World Acquisition Corp. stock is all the way back to $48 – right where we started three weeks ago.
DWAC and Truth Social are tied at the hip because DWAC has already announced plans to complete a blank-check merger with Trump Media & Technology Group, the company headed by the former president in his effort to return to social media.
The company has been plagued by a slow rollout that raises a lot of suspicions of ineptitude. It missed a self-imposed deadline of March 31 to be fully operational as thousands remained stuck on a wait list.
However, Truth Social recently moved to the top of the App Store downloads list, so perhaps the company is getting the waitlist issues behind it.
Even so, I think there’s more questions than potential for DWAC stock. There’s no guarantee that U.S. regulators will allow the SPAC deal to come to fruition. “DWAC’s stock has much further to fall given the demonstrably misleading statements in DWAC’s registration statement, the status of TMTG’s operations at the time the merger agreement was executed, the cast of characters seeking to consummate that merger and those individuals’ flagrant disregard for SEC rules and regulations,” Kerrisdale Capital, which is short DWAC stock, said in a scathing report.
If you want to invest in a social media stock, stick with Twitter. There’s even word that Musk plans to bring Twitter back with an IPO in just a couple of years, anyway, so you won’t have to wait for long.
On the date of publication, Patrick Sanders did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.