CNN business reporter Matt Egan gushed to anchor Kate Bolduan former President Donald Trump’s Trump Media (DJT) stock price is “on fire” in a “stunning move” upward — but added the stock “probably goes to zero” if Trump loses the election.
Former President Donald Trump’s Trump Media and Technology (DJT) company began trading on the NASDAQ stock exchange in the spring and immediately shot up in initial trading. But, the following Monday saw the stock sharply fall after some negative financial disclosures, then rallied somewhat, but has now fallen sharply again as Vice President Kamala Harris gains in the polls, and after Trump made an ostentatious return to X/Twitter.
On top of that, last week Truth Social’s co-founders sold off about $100 million of their stock, and the date on which Trump can sell his shares is approaching. For weeks the stock sat just above its all-time low, with a share price slightly north of 16 bucks.
But on Monday’s edition of CNN News Central, Egan and Bolduan marveled at the stock’s resurgence amid a tightening race between Trump and Harris — a boom Egan says will bust if Trump loses:
KATE BOLDUAN: Donald Trump’s social media company is making a comeback on Wall Street. But why and why now? CNN’s Matt Egan’s looking into that. He’s here with us now. What are you expecting with this now? What are you hearing about this and what are you expecting now with the markets about to open?
MATT EGAN: Yeah, it’s not moving much this morning, but that’ll change, I’m sure.
Listen, this stock was in meltdown mode all summer, but now it is on fire! Since September 23rd, it’s up 108%! That’s doubling in the span of three weeks! It’s a stunning move!
One of many stunning moves for this company. And it’s a reminder of two things, right? One, this is not a normal stock. It doesn’t trade on fundamentals. Things like earnings and revenue. It trades–.
KATE BOLDUAN: Or growth.
MATT EGAN: Or growth! It trades on hype and momentum and the mood in Trump world. The other thing that this shows, though, is that it’s inextricably linked to the election.
When President Biden dropped out over the summer, this stock went down. It crashed to record low after record low. One point it was down more than 80% from its peak. Look at that chart. You see it kept going down, down, down.
But now that the polls have tightened and that this looks like a race that could go either way, it’s like someone flip the switch and the stock is just going straight up. Now, obviously, it’s still down from where it was, but that is just that remarkable move.
Now. Wall Street veteran Matthew Tuttle, he told me it’s really simple. People realize that if Trump gets elected, this stock has the potential to do something.
And if he doesn’t get elected, it probably goes to zero.
Now, it is absolutely stunning to think about a company that is valued in the billions of dollars having such a binary outcome here.
And don’t forget that the former and potentially future president of United States has a significant amount of his net worth tied up here. Right? I mean, he’s the face of the company. He owns almost 115 million shares.
Now, those shares, back when this stock was down, down, down, it was worth $1.4 billion. Those shares. It has more than doubled now, worth nearly $3 billion. Right?
So he’s made that much money in just the span of three weeks. It’s really, really remarkable. Now, in the long run, though, this company still obviously has challenges right? They’re burning through money. True, social remains very tiny, generating almost no revenue.
And so that’s why Professor Jay Ritter, who’s been studying this stuff for four decades, he told me that he thinks that the stock is still dramatically overvalued and in the long run, it’s going sharply lower.
KATE BOLDUAN: I mean, it just, it just feels all like funny money when it comes to this. The roller coaster has been remarkable.
MATT EGAN: It’s such a ridiculous story.
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