Donald Trump’s media company is enjoying a stock market resurgence, with shares of Trump Media & Technology Group soaring Tuesday as betting markets now bet that the former president is favored to win the Nov. 5 election.
The focus on Trump Media – which trades under the symbol DJT, the same as Trump’s initials – has led to a surge in trading volume, with the New York Stock Exchange halting trading in the stock on several occasions Tuesday due to unusual volatility.
Shares jumped $5.86, or 12.4%, to $53.22 Tuesday afternoon. The stock has more than tripled in value over the past month.
With polls showing the presidential race to be extremely close, betting markets such as Polymarket are now predicting that Trump will be the favorite to win the election. While Polymarket said last week that a French individual entrepreneur was behind four accounts that spent millions to buy the Trump contract, the international platform determined that it was not manipulation of walk.
Trump Media has been volatile since it began trading in March, initially hitting a valuation that exceeded $9 billion despite a history of losses, before falling to a low of $11.75 per share in September. Much of the stock’s movement has to do with Trump’s political fortunes, with DJT rising when his chances appear to be improving.
This has led to comparisons to a meme stock or a company whose shares trade on social media buzz instead of traditional analytical metrics such as revenue growth and profitability. Trading volume in DJT stock has been unusually high over the past two weeks, with trading volume topping 120 million shares on Tuesday, compared to a 30-day average trading volume of 35 million shares, according to the financial data company FactSet.
“DJT has been very volatile due to speculators being momentum players,” Jay Ritter, a finance professor at the University of Florida, wrote in an email to CBS MoneyWatch. “These speculators buy when the price rises, causing the price to rise, but then sell when the tide turns, sometimes leading to sharp declines.”
But Trump Media has little revenue or growth to attract institutional investors, while it has become expensive to sell short because of the cost of borrowing the stock, Ritter added.
“The company is losing money and depleting its liquidity. In the short term, anything can happen to the price, but the long-term trend will be downward,” he added.
