Former president and Republican front-runner Donald Trump likely reaped a hefty dividend this week as the stock price of his social media platform Truth Social skyrocketed.
The company’s stock price soared for several days in a row this month, marking the longest streak since June. On Friday, Trump Media was up nearly 5%, compared to earlier days in the week when it was up nearly 19%.
Donald Trump Media, which runs Truth Social, has soared about 53% in the past month. It currently trades at about $25 per share.
Trump, who has a market capitalization of about $5 billion, stands to make significant gains from recent stock trades.
Republican presidential candidate and former President Donald Trump speaks at a campaign rally at Santander Arena on October 9, 2024 in Reading, Pennsylvania. The stock price of Trump’s social media platform “TruthSocial” is soaring… Former Republican presidential candidate Donald Trump speaks at a campaign rally at Santander Arena in Reading, Pennsylvania on October 9, 2024. president. Shares of President Trump’s social media platform Truth Social have soared over the past week. More Chip Somodevilla/Getty Images
Mr. Trump owns 57% of the stock, with a total value of about $2.8 billion, so Mr. Trump has lost ground in stock value alone since Tuesday, according to Alex Bean, a financial literacy instructor at the University of Tennessee at Martin. It is likely that he won $300 million.
“Truth Social is a very special case because there are very few times in the history of the market where stock prices have been so tied to election outcomes,” Bean told Barron’s. “We are no strangers to seeing certain sectors emerge based on predictions of how the industry will benefit from a new administration, but in the case of Truth Social, the president-elect is majority-owned. You’re dealing with a social media company that may be in the United States.
Truth Social reached its all-time high in March when it listed on the Nasdaq, with its stock soaring to $79.38. Stocks have generally been on an upward trajectory this month, but after Mr. Trump held another campaign rally this week near Butler, Pennsylvania, where he survived an assassination attempt on July 13, stocks tumbled sharply. showed an increase.
“Trump has done very well,” Kevin Thompson, a financial expert and founder and CEO of 9i Capital Group, told Newsweek. “My guess is that he issued stock at a higher valuation and that gave him a lot of money to pay his legal costs.”
Despite the strong stock activity, Truth Social has also been in the news recently for some potentially negative reasons.
The social media platform’s chief operating officer, Andrew Northwall, resigned in September, and chief product officer Sandro de Moraes is also reportedly no longer involved with the company.
Trump Media previously reported a net loss of more than $340 million on revenue of less than $2 million in its most recent quarterly report.
Given this recent move, Thompson said this week’s stock price movement is “relative.”
“It has no impact on stock prices because it’s about the election,” Thompson said. “But it could be a reflection of people’s aspirations and interest in his campaign.”
Bean said the rise in stock prices over the past week correlates with Trump’s improving poll numbers in battleground states and could indicate Trump’s chances of winning the White House are increasing. He said there is. But he still cautioned against joining the Truth Social bandwagon as an investor.
“This remains a risky investment for a variety of reasons,” Bean said. “Regardless of your feelings about the potential outcome of the election, it would be best to avoid this stock as a long-term portfolio choice.”
