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Truth Social parent company's stock market debut: "It's hot as a gun and doing great"
Photo: Chris Delmas / AFP
Despite the questionable future prospects of his online network Truth Social, former US President Donald Trump's media company debuted on Wall Street with price gains of 37 percent. The shares of Trump Media & Technology Group (TMTG), which were placed at $49.95, rose to around $67 on their first day of trading. The parent company of Trump's online network has a market value of $9.08 billion.
This means that the share price is well above the value that experts consider appropriate. The euphoria surrounding Trump's recent candidacy for the White House is not least responsible for this. The shares are traded under the ticker symbol “DJT” – the ex-president’s initials. Trump owns almost 60 percent of the company.
TMTG was acquired by blank-check firm Digital World Acquisition Corp. on Monday. taken over to enable the IPO. Trump Media has now taken Digital World's place on the Nasdaq stock exchange. Many of Trump Media's investors are small investors who are either trying to support Trump or profit from the cult surrounding him. Those shareholders helped Digital World's stock price more than double this year in anticipation of the merger.
Truth Social was launched in February 2022, a year after Trump was banned from major social platforms like Facebook and X following the storming of the US Capitol. Although he has since been reinstated to both networks, Trump has remained with Truth Social.
In a regulatory filing, Trump Media said it was "highly dependent on the popularity and visibility of President Trump." If the former president were to limit or terminate his relationship with the company for any reason, “significant” disadvantages could be expected for the company. The company also pointed to Trump's involvement in numerous legal proceedings. An adverse outcome in one or more cases could have a negative impact on Trump Media and Truth Social.
Trump wants to finance his presidential candidacy with a profit
The former president himself recently commented on his online network after a court hearing: "Truth Social is doing very well," he said and added in his usual Trump manner: "It's hot as a pistol and is doing great."
However, the ex-president rejected speculation that Trump could use the profits from the IPO to pay his court bail. He recently announced on Truth Social that he had another use for the money in mind other than paying the fine imposed by the judge. Rather, Trump plans to invest a “substantial amount” of his assets in his presidential candidacy.
eru/AP/Reuters