Donald Trump’s recent financial windfall has left many scratching their heads as his social-media company, Trump Media & Technology Group, saw its stock soar to a market capitalization of close to $8.4 billion. However, the company’s main asset, Truth Social, has not seen the same success, with only about 1.5 million monthly visitors compared to other social media giants.
The inflated stock price of Trump Media & Technology Group has raised concerns of a potential bubble, with the company’s valuation being more than eighteen hundred times its 2023 revenue. This has drawn comparisons to other meme stocks like GameStop and AMC Entertainment, which saw their stock prices plummet after reaching astronomical highs.
Despite the uncertainty surrounding the company’s true value, small investors, including some Trump supporters, have continued to buoy the stock price. However, experts warn that bubbles eventually burst, and Trump may need to act quickly to cash out before his paper wealth evaporates.
With a lock-up provision in place preventing insiders from selling stock for several months, Trump faces a dilemma on how to capitalize on his newfound wealth. Options such as using his stock as collateral for loans or forcing the company to pay him licensing fees have been suggested, but each comes with its own set of challenges.
As Trump navigates this financial opportunity, he must tread carefully to avoid a potential financial disaster. The stakes are high, and the future of Trump Media & Technology Group remains uncertain in the volatile world of stock markets.
