Trump Media & Technology Group (DJT) stock has fallen since its IPO, but why?
2024-04-09 05:28:24 Eastern Standard Time
March 26th
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the Nasdaq Stock Exchange welcomed the debut of a flashy new SPAC called Trump Media & Technology Group Corporation (DJT).
The company behind Truth Social, President Trump’s social media alternative to X, had strong trading. The company’s stock rose more than 16% on its first day of trading, and rose another 14% the next day. First price is $49.95 per share on March 26th.
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the stock price soared to a high of $79.38 on the 26th.
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They were still worth more than $70 each as of March 28
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.
Overall, the stock price soared more than 40% in the first few days of trading on the Nasdaq.
Fall of more than $13
But that was then. Late yesterday afternoon, during the New York trading session, DJT stock fell more than 10%, trading at just $36.44 by market close.
This means the stock has fallen about 37% since its Nasdaq debut, with DJT stock plummeting more than $13 from its original price of $49.95.
In fact, before the US and European markets opened today, DJT stock fell 8.43%, or nearly $4 per share.
Why did DJT’s stock price fall?
There are three possible reasons for the Trump media’s downfall. The first is the company’s shaky financial condition, telling the U.S. Securities and Exchange Commission (SEC) last week that the company’s revenue for the previous fiscal year was just $4.13 million, dwarfed by a net loss of more than $58 million. It became clear that
This eroded investor confidence, and the stock began to decline on Friday, April 5th.
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which gained momentum only after a second potential contributor, an ill-timed television interview.
Trump Media & Technology Group News
Sunday, April 7th
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, Trump Media & Technology Group CEO Devin Nunes appeared on Fox News to promote the company. Nunes did not mention the SEC disclosures, which were public knowledge at the time, instead claiming to Fox News’ Maria Bartiromo that the company was debt-free and had “$200 million in the bank.” did.
Nunes also said that DJT’s SPAC attracted 400,000 individual shareholders and that the company “believes we have added another 200,000 individual investors.”
Trump media “fixes reality”
According to journalist Jill Filipovich, this last admission shows that the company is being supported by individual investors rather than the large institutional investors who have supported DJT because they see it as a healthy company. That’s what it means.
Filipovic said in an opinion piece for CNN:
The market seems to have adjusted reality slightly. By Monday afternoon, Trump Media’s valuation had fallen to $8.8 billion. But experts say the company remains vastly overvalued. And that’s largely because Trump’s conservative fans are buying stocks because they like Trump and believe what he stands for, not because the company is objectively a good buy. ”
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