Trump Media & Technology Group (DJT) stock fell double digits in premarket trading on Thursday, reversing the gains it made on Wednesday when Donald Trump emerged victorious over Kamala Harris in the presidential election.
Shares in the company — home to Trump’s social media platform Truth Social — have been on a wild ride over the past week, with the up-and-down moves largely tied to Trump’s chances of winning back the White House.
The stock is down about 10% in the past five days, although shares are up nearly 120% in the past month.
Strategists have categorized the stock as a binary bet on the election. Matthew Tuttle, CEO of investment fund Tuttle Capital Management, recently told Yahoo Finance’s Catalysts that the stock’s trajectory depended on a “buy the rumor, sell the fact” trading strategy.
“I would imagine you would see this happen the day after he won,” he predicted at the time.
Steve Sosnick, chief strategist at Interactive Brokers, said DJT has taken on a “life of its own.”
“It’s been volatile on the way up, and when a stock is that volatile in one direction, it tends to be that volatile in the other direction,” he said on a call with Yahoo Finance last week.
In September, shares in Trump Media traded at their lowest levels since the company’s debut, following the expiration of the much-discussed lock-up period. Stocks eventually recovered from their lows as both domestic and foreign betting markets began to shift in favor of a Trump victory.
Trump founded Truth Social after being kicked off major social media apps like Facebook (META) and Twitter, now X, following the Capitol riots of January 6, 2021. Trump has since been reinstated on those platforms. He officially returned to his post at X in mid-August, after a hiatus of about a year.
While Truth Social looks to take on social media incumbents, the company’s fundamentals have long been in question.
On Tuesday, DJT dropped its third-quarter results after the market closed, showing a net loss of $19.25 million for the quarter ended September 30. This was smaller than the $26.03 million the company reported in the year-ago period.
DJT also reported revenue of $1.01 million, a slight year-over-year decline compared to the $1.07 million it reported in the third quarter of 2023. Over the past nine months ended September 30, revenue is down 23% compared to compared to the previous year. period.
Last month, the company announced that its COO had resigned in September.
Trump has about a 60% stake in DJT. At Wednesday’s closing price of about $36 per share, Trump Media had a market capitalization of about $7.2 billion, giving the former president a stake of about $4.3 billion.
