Replies to post #220190 on DD Support Board and Research Team

[BullNBear52]

DJT stock hits turbulence: More volatility ahead for Trump's high-flying Truth Social
Jessica Guynn
Bailey Schulz
USA TODAY
https://www.usatoday.com/story/money/2024/03/28/truth-social-trump-media-slide/73131957007/?tbref=hp

...Its market valuation, just over $8 billion, is still stunning for a social media fledgling with an unproven business model that has struggled to attract users and advertisers, burned through cash and wracked up losses.
“The valuation of the company should be several hundred million, not the billions it is currently valued at,” University of Florida professor Jay Ritter said.

....“The stock will continue to be very volatile, with sharp moves up and down. But the long-term trend will be down,” he said. “The company has about $2 in cash per share, but it will probably burn through that money and the most likely outcome is eventual bankruptcy.”

....Trump Media trading like meme stocks
Trump Media’s trading has mimicked meme stocks like GameStop and AMC Entertainment, which rose to improbable heights in 2021 after individual investors organized on social media platform Reddit to drive up the stock price. Those investors aimed to strike back against hedge funds that had bet against the company and shorted the stock.

.....Roberson, 52, from the Dallas-Fort Worth metroplex in Texas, said she purchased five shares of Trump Media at about $72 a pop, right around the stock price’s Monday peak, to show her support for the former president.

“It’s mainly to support Trump and his legal battles,” she said.


....Trump Media’s Nasdaq debut padded Trump’s wealth by about $5 billion – though only on paper.

And cashing out won’t be easy. Trump Media has restrictions that prevent insiders from selling shares or using shares as collateral for loans for at least six months.


The board which is stacked with Trump allies could waive those restrictions. It could also hold a secondary offering to allow insiders an earlier opportunity to sell.

The risk for Trump Media: If Trump sells shares, it could deflate the stock price.

“Donald Trump has substantial paper wealth in the stock, but the ability to turn it into cash is limited,” Ritter said. “By the time that he can sell shares, the price is likely to be in the single digits. And the more shares that he sells, the lower will be the price.”