Phunware (NASDAQ:PHUN) stock is up more than 10% today, rallying on news that Elon Musk is abandoning his planned acquisition of Twitter (NYSE:TWTR).
Phunware is an integrated software company also known as a “Trump stock,” associated with former President Donald Trump’s presidential campaigns. Shares of PHUN closely track the movements of Digital World Acquisition (NASDAQ:DWAC) as well, the special purpose acquisition company (SPAC) taking Trump Media & Technology Group public. DWAC stock is climbing 10% today on the Twitter bid news, too.
Here’s what investors should know about PHUN stock moving forward.
What’s Happening With PHUN Stock?
Trump Media & Technology and DWAC are focused on developing Truth Social, a platform like Twitter that’s aimed at competing directly against the social media giant. As such, investors see any bad news for Twitter as good news for DWAC and related stocks, including PHUN stock.
How is Phunware tied to Truth Social, DWAC and Trump? Well, the company partnered with Trump’s 2020 re-election campaign. It’s also expected to help with Trump’s potential 2024 presidential bid, should he run again. This connection has shares of the software company moving in tandem with DWAC stock.
Investors appear to be responding favorably to the news that Tesla (NASDAQ:TSLA) CEO Elon Musk is walking away from the $44 billion deal to buy Twitter. Musk had said he would allow Trump back on Twitter if he bought the platform. Now, the fallout of the deal still appears to be good news for Truth Social.
Still, Truth Social experienced a rocky start when it first launched, driving shares of its SPAC partner down. Despite today’s rise, DWAC stock is down 46% year-to-date (YTD). Similarly, PHUN stock is down 49% YTD.
Both PHUN stock and DWAC are getting a lift today on the called-off acquisition news. Now, investors appear to be betting that Trump’s continued Twitter ban will turn more users to Truth Social. With both Phunware and DWAC down for the year, however, where they go next remains to be seen.
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On the date of publication, Joel Baglole did not hold (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.