Trump Media (NASDAQ:DJT) stock rose despite the company continuing to lose money.
The social media company built around former President Trump lost $327 million on revenue of $770,000. The adjusted loss before Income Taxes, Depreciation, and Amortization (EBITDA) was $12.1 million.
Despite this, the shares rose slightly overnight. They were due to open May 21 at $48.45 each, a market capitalization of $6.6 billion.
Trump Coin
Trump Media seems to trade more as a proxy for the former President’s re-election chances than as a corporate entity. Recent polls have him ahead of President Biden in swing states needed to win.
Trump Media completed its merger with Special Purpose Acquisition Company (SPAC) Digital World Acquisition in March. At that time, it claimed $274 million in cash that would fund operations “for the foreseeable future.”
Since then, the stock has had a high of over $70 per share, and a low of $22, as investors speculate about Trump’s chances. That’s why I call it a “Trump Coin,” since there’s nothing there but a claim of value.
The main product of the company are the “truths” of Trump himself. One recent video includes World War I-era newspaper clippings and refers to “the creation of a unified Reich.” It was likely the product of using cheap stock imagery from a campaign dedicated to paying off its candidate’s legal bills. Trump himself has mostly been in New York, standing trial over falsifying business records in the lead-up to his 2016 election.
Trump fans on the site, meanwhile, have been joining in on his anger, some calling for the execution of judges hearing cases against him. Reuters counted over 150 posts since March 1 calling for physical violence against judges. Experts on extremism fear the verbal threats could turn into real violence as the November election approaches.
DJT Stock: What Happens Next?
DJT stock will likely continue to trade as a proxy for the candidate and his movement. But it’s uncertain what will happen to the company regardless of the election result.
On the date of publication, Dana Blankenhorn 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.
