Donald Trump’s fortune received another boost as the stock of Trump Media & Technology Group continued to rise, signaling potential gains for the former president.
In premarket trading on Wednesday, Trump Media shares surged by 11% to reach $64.18. This uptick follows the company’s recent stock market debut under the DJT ticker, following its merger with special-purpose acquisition company Digital World Acquisition Corp.
On Tuesday, Trump Media stock closed up by 16% at $57.99, translating to a market value of approximately $8 billion. With Trump holding around 60% stake in the company, his estimated worth stands at about $4.5 billion, thereby propelling him to become one of the 450 richest individuals globally, as per the Forbes list of billionaires.
The latest surge in premarket trading could potentially add close to another $500 million to Trump’s wealth on paper. Moreover, he stands to receive tens of millions of additional shares if the stock maintains certain price levels in the upcoming weeks.
However, Trump faces legal challenges, including a requirement to post a $175 million bond to appeal a civil-fraud case in New York and prevent asset seizure by the state. Although he is prohibited from selling Trump Media shares until the expiration of a six-month lockup period, he could seek a waiver from the company’s board, which includes his son and former administration members.
Investing in Trump Media also carries risks, including the company’s reported revenue of $3.4 million and a loss of $49 million during the first nine months of 2023. While the company operates the Truth Social platform, its trading price-to-sales multiple exceeds that of its social-media peers, raising concerns among analysts.
Tom Hulick, CEO of Strategy Asset Managers, emphasized the potential for a significant decline in the company’s stock value, considering the valuation’s inability to be justified. Nonetheless, he acknowledged the influence of momentum in the short term, indicating uncertainty regarding how high the stock could surge in the interim.