Donald Trump’s media company is enjoying a stock market resurgence, with shares of Trump Media & Technology Group soaring on Tuesday as betting markets now wager the former president is favored to win in the November 5 election.
The focus on Trump Media — which trades under the ticker DJT, the same as Trump’s initials — have led to a spike in trading volume, with the New York Stock Exchange halting trading of the stock several times on Tuesday due to unusual volatility.
Shares jumped $5.86, or 12.4%, to $53.22 in Tuesday afternoon trading. The stock has more than tripled in value during the past month.
While the polls show that the presidential race is extremely close, the betting markets such as Polymarket are now predicting that Trump is favored to win the election. While Polymarket last week said a sole French trader was behind four accounts that spent millions to purchase the Trump contract, the international platform determined it was not market manipulation.
Trump Media has been volatile since it began trading in March, initially surging to a valuation that topped $9 billion despite a history of losses, before falling to a low of $11.75 a share in September. Much of the stock’s movement is tied to Trump’s political fortunes, with DJT swinging upwards when his odds appear to improve.
That’s prompted comparisons with a meme stock, or a company whose shares trade on social media buzz instead of traditional analytical measures such as revenue growth and profitability. Trading volume in DJT shares has been unusually high in the last two weeks, with its trading volume topping 120 million shares on Tuesday, versus its 30-day average trading volume of 35 million shares, according to financial data firm FactSet.
“DJT has been very volatile due to speculators that are momentum players,” University of Florida finance professor Jay Ritter wrote in an email to CBS MoneyWatch. “These speculators buy when the price rises, pushing up the price, but then sell when the tide turns, resulting in occasional big drops.”
But Trump Media has little in the way of revenue or growth to attract institutional investors, while it’s become expensive to short because of the cost to borrow shares, Ritter added.
“The company is losing money, burning through its cash. In the short run, anything can happen to the price, but the long-term trend will be down,” he added.
