Trump's Media Company Surges in First Day of Trading

[applegrove]

Trump’s Media Company Surges in First Day of Trading

March 26, 2024 at 9:59 am EDT By Taegan Goddard 389 Comments

https://politicalwire.com/2024/03/26/trumps-social-media-company-surges-in-first-day-of-trading/

"SNIP..........

“There’s a new high-flying stock on Wall Street that some investors are eagerly piling into. Its largest shareholder is former President Donald J. Trump,” the New York Times reports.

“His social media company, Trump Media & Technology Group, began trading on the Nasdaq on Tuesday, under the ticker DJT, and immediately surged in value, gaining 40% in early trading.”

Wall Street Journal: “Its shares soared after the opening bell, giving it a market value of roughly $9.5 billion. The gobsmacking stock price makes Trump’s approximately 60% stake worth approximately $5.5 billion. Those values will continue swinging with the stock price.”

.........SNIP"

Applegrove:

A great transfer of wealth to Trump while he is running and under election finance laws. Trump can sell his shares in 6 months, so October.

[Joinfortmill]

1. This is gonna crash and burn.

[kysrsoze]

3. Oh yeah. This is irrational exuberance by MAGAs right now.

This is a classic pump and dump scheme. One people figure out this stuff isn’t making money and won’t in the future, the stock price will plummet.

[Qutzupalotl]

2. I wonder where it will be when

Trump loses in November.

[DavidDvorkin]

4. It's still high but has dropped a bit

You can follow it here:
https://www.google.com/search?q=djt+nasdaq

[bluesbassman]

5. I'm certainly no stock or economics expert,

but how is a company valued at $9.5 billion when it had revenue for 2023 in the low seven figures and losses close to $50 million? It's not even ground breaking tech or from what I've scene even a very good platform. This is the epitome of a smoke and mirrors scam.

[applegrove]

6. Some suspect when it does tank there will be more court cases.

[WarGamer]

7. Welcome to Wall Street.

I can show you companies with 40B in assets worth 2T and companies losing millions each quarter worth 500B.

"Value Investments" are soooo 20th Century.

[bluesbassman]

9. I get that, but do those companies have an infrastructure? A tangible, proven product?

Truth Social has been a dog and disaster from the git-go. I know MAGA cult members are gullible and stupid, but this is just insane.

[Torchlight]

8. The six-month Pet Rock craze in the summer of '77 had more staying power

Trump's stench on this will make Enron look like an American success story.

[bluesbassman]

10. Hey, I still have one of those in the original box. Inherited it from my aunt.

It's my retirement nest rock!

[SWBTATTReg]

11. Sure sounds like a pump and dump operation to me...I'd be very careful about investing in this stock, as expectations

are far ahead of what the going stock price is now (as compared to current earnings, e.g., price/earnings ratio).

[applegrove]

12. I'm sure many are shorting the stock. I'm guessing that

there are people shorting the shorters.

[SWBTATTReg]

13. I wouldn't be surprised, might even be somewhat smart...but I don't want to risk it.

[lame54]

14. Lamestock

[moondust]

15. Mostly rubles and riyals?

Laundry Day?

[LetMyPeopleVote]

16. DJT is a meme stock that relies on the greater fool/idiot theory

Meme stocks rely on the greater fool theory. I was amused to see that DWAC/Trump Media is classified as a meme stock where the value is due to personality and not due to the real value of issuer of the meme stock. This article is a good discussion of the meme nature of DWAC/TMT.
https://www.vanityfair.com/news/donald-trump-truth-social-media-merger

Trump’s financial future now hinges on some of the strangest fads in corporate finance—meme stocks, SPAC deals, and cult-of-personality investing. If Trump can find a way to act fast, it might just be the bailout he desperately needs.

Truth Social is a bad imitation of Twitter, where Trump was an unavoidable presence long before he ran for president. It’s chock full of stale red-pilled memes, MAGA conspiracy theories, and of course, Trump. That’s the main draw. Truth Social is the only place the former president now regularly posts his unfettered thoughts......

DWAC is best thought of as a meme stock. You may remember the meme stock fad from when retail investors on Reddit successfully coordinated a short squeeze with GameStop stock, before glomming onto a series of other millennial nostalgia brands like AMC Entertainment, BlackBerry, and Bed Bath & Beyond. Meme stocks are often publicly traded companies that attract an inordinate percentage of individual investors and their stock performance fluctuates in a way that’s significantly divorced from the reality of their underlying business. Combine those two trends and you’ll start to see why Trump’s media company could be valued at roughly $9 billion if it merges with DWAC.

Jay Ritter, a finance professor at the University of Florida, says meme stocks often depend on the “greater fool theory of investing,” meaning rational investors might buy in expecting the stock price to rise and betting that they can sell their shares to a greater fool willing to buy them at a higher price. In this case, however, Ritter speculates there is an inordinate number of individual retail investors compared to institutional investors, such as hedge funds, that normally own SPAC shares prior to a merger. “Here you’ve got ideology involved [too]—as far as I can tell, the vast majority of DWAC investors are Trump political investors, and they’re to some degree putting their money where their mouth is… My suspicion is most of them have bought the stock as a show of political support.” In this way, Trump is conducting yet another public fundraising from his supporters—this time through the public markets.

Idiots who purchase meme stocks are betting that they can get out before the other idiots figure out that the stock is worthless