Trump Media and Technology Group (TMTG), trading as DJT on the Nasdaq, has seen an astonishing 198% rally this past month, bouncing from its record low of $12.15 in late September to $36.30 per share. The parent company of Truth Social—a social media platform founded by former President Donald Trump after he was removed from mainstream platforms in January 2021—has surged, despite ongoing financial struggles.
In the first half of 2023, TMTG reported $344 million in losses on just $1.6 million in revenue. However, this financial performance hasn’t deterred momentum-based investors, many of whom have been drawn in by the stock’s recent climb and high trading volumes. Analysts suggest that short-term traders are fueling this rise as they chase gains in high-volatility stocks. According to Jay Ritter, a finance professor at the University of Florida, this type of trading contributes to volatility, as a price rise can attract even more buyers, and any dip may cause a rush of selling. He noted that October’s trading volume for TMTG was unprecedented, with over 278 million shares changing hands in one week alone.
TMTG’s stock movement seems closely tied to Trump’s polling numbers, which have shown him gaining ground on Vice President Kamala Harris in the presidential race. Recent election forecasts, such as those from The Economist and pollster Nate Silver, see the race between Harris and Trump as nearly deadlocked, with some models giving Trump a slight edge.
This unusual trading behavior has led to TMTG being likened to a “meme stock.” Like other meme stocks, TMTG’s price is driven more by sentiment than by traditional business metrics, functioning as a form of political support for Trump rather than reflecting the company’s financial health. According to George Kailas, CEO of Prospero.ai, many TMTG investors are deeply loyal to Trump, often dismissing counterarguments or financial red flags. This trend has created an echo chamber among shareholders, amplifying political sentiment in the stock’s price movements rather than market fundamentals.
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