The shares of Trump Media & Technology Group Corp. experienced a significant increase of 16% on Wednesday. This improvement provides a small recovery from the billions the company lost in market value since its public debut three weeks ago.
The Company’s Best Day Since Its Debut
The company, founded by former president Donald Trump, closed at $26.40, an increase from the $22.84 closing on Tuesday. This has been the company’s best day since it went public through a merger with Digital World Acquisition Corp. This increase occurred even as over 13 million shares were traded, with warrants associated with the company soaring by 30% to reach $11.45.
However, even with this rebound, the stock has lost approximately $5.4 billion from its peak last month. The value of Trump’s holdings has also decreased to $2.1 billion.
The Nature of the Deal and Insider Trading
Under the terms of the deal, insiders at Trump Media, including the former president, are prohibited from selling shares until September. But, the board has the power to lift these sales restrictions. If this happens, it would allow many of the largest shareholders to cash out once a filing is approved by US regulators.
Operations and Revenue Generation
On Tuesday, Trump Media announced that it had completed the research phase of its new live TV streaming platform. However, the company’s operations have largely struggled since its launch. Last year, Trump Media lost over $50 million while generating a meager revenue of $4.1 million, according to regulatory filings.
The Stock’s Volatility
Despite these challenges, the company’s shares have maintained a 51% gain this year. However, the stock’s volatility has made it a difficult trade for Wall Street professionals. It ranks among the market’s most expensive shorts, with financing fees reaching over 700% earlier this month. The options underlying the stock have led industry veterans like the former “Bond King” Bill Gross to sell the costly derivatives instead of directly betting on the stock.
Legal Challenges for Trump
As Trump faces four criminal prosecutions, his campaign to return to the White House continues. The first criminal trial began on Monday in Manhattan, where he faces accusations of falsifying business records to conceal a hush-money payment to a porn star before the 2016 election. Trump dismissed the case as an outrage and a persecution.
Through the ups and downs, the developments at Trump Media & Technology Group Corp. are sure to continue capturing the attention of Suwannee County residents and beyond.
