Stocker Energy
Former president Donald Trump’s meme stock is in freefall.
Shares of Trump Media & Technology Group (TMTG) have slid significantly this week, falling nearly nine percent today alone.
The news comes after Trump reiterated that he’ll double down and continue to use Truth Social, a far right social media platform owned by TMTG, despite major losses and a seriously dubious financial outlook.
Shares of the group have been tanking ever since it merged with a blank check acquisition company last month, falling almost 25 percent in the last five days.
At the time of writing, shares are hovering around $42, well below the price at the merge, wiping out billions of dollars in value, including $1 billion of Trump’s own net worth.
Trump, as he often does, has responded with seething grievance.
“When I ENDORSE a politician on TRUTH, they almost ALWAYS WIN,” he wrote in a rambling and incoherent Truth Social post on Thursday. “If it didn’t work, or properly get the word out, I wouldn’t use it — But it does work, and work really well — And the fun is just getting started!!!”
The Conald
Analysts, who’ve long predicted this outcome, have argued that thanks to a lack of any semblance of revenue growth, TMTG shares are “grossly overvalued.”
Last week, news emerged that Truth Social made a measly $4.1 million in revenue for all of 2023, despite having lost more than $58 million over the same period.
Even after the slump, TMTG has a market capitalization of over $5.7 billion, eclipsing the company’s revenues.
“I mean, it’s ridiculous,” Barry Diller, chairman of holdings company IAC and Expedia, told CNBC on Thursday. “The company has no revenue.”
“It’s a scam, just like everything [Trump’s] ever been involved in is some sort of con,” he added.
Case in point, earlier this week, two Florida brothers pleaded guilty to being involved in a $23 million insider-trading scheme leading up to TMTG’s merger.
Democratic lawmakers are also calling for Congress to investigate the merger, citing a Guardian report that alleges TMTG relied on emergency loans, which were provided by a Russian-American businessman — who’s currently under criminal investigation.
In short, it’s no wonder investors are advised to stay far away from the company.
“It is a new day for Trump Media,” Forbes contributor and investment analyst John Tobey wrote, arguing there’s “no special future potentiality to speculate on.”
“Therefore, if the stock doesn’t jump above $50 on Friday, holding on looks especially risky, and searching for another investment looks especially promising,” he added.
More on the merger: Trump Sues “Truth Social” Cofounders as Company’s Stock Crumbles