New York [US], June 1 (ANI): The historic conviction of former President Donald Trump is causing significant volatility for Truth Social owner Trump Media & Technology Group, with shares fluctuating dramatically since the Manhattan jury's guilty verdict on Thursday, CNN reported.
Trump Media, known for its volatile nature since its debut in late March, witnessed steep losses and sharp gains following the conviction. Initially plunging as much as 15 per cent on Thursday evening in response to the conviction, the stock rebounded slightly on Friday, opening 4 per cent higher before surrendering those gains.
In recent trading, Trump Media has seen a decline of about 5 per cent, according to CNN.
Matthew Kennedy, senior IPO market strategist at Renaissance Capital, explained the heightened volatility, stating, "Trump is the key figure here, so it's no surprise that a conviction results in extra volatility as traders reassess what that means for the company."
As the chairman of Trump Media and the most prominent user on Truth Social, Trump's influence on the company's fortunes is substantial. The company's ticker symbol, "DJT," reflects his significance.
Kennedy noted that the stock's performance has long been tied to investors' expectations of Trump winning the 2024 election and utilizing Truth Social as his primary platform.
Despite Trump's significant stake of 114.75 million shares, valued at approximately USD 6 billion, Truth Social remains a minor player in the social media landscape with limited revenue generation.
During the first quarter, Trump Media reported revenue of just USD 770,500, marking the second consecutive quarter of revenue below USD 1 million. The company incurred a loss of USD 328 million in the first quarter, primarily due to one-time losses associated with its controversial merger.
Since its public debut, Trump Media has been exceptionally volatile, drawing comparisons to meme stocks and being described as a "meme stock on steroids," trading more on social media hype than on fundamental metrics, CNN reported. (ANI)
