Donald Trump’s first day back on the stock market was eventful.
Shares of Trump Media & Technology Group (DJT), the parent company of President Trump’s social media platform Truth Social, rose 16% on Tuesday in its first day of trading under its new ticker. Before the market opened on Tuesday, the stock was up 50%.
The company received shareholder approval last week to merge with special purpose vehicle Digital World Acquisition Corp. (DWAC), which had been publicly traded since 2021.
At Tuesday’s closing price of $57.99, Trump Media’s market capitalization was about $8 billion.
The former president founded Truth Social, the platform now known as X, after he was banned from major social media apps such as Facebook and Twitter following the Jan. 6, 2021, attack on the Capitol. Trump has since returned to those platforms.
Trump will own about 60% of Truth Social, which is currently worth about $5 billion. The merger comes as Trump faces a $454 million fraud fine and a campaign cash crunch as he prepares to run again against Biden in the 2024 presidential election.
But Trump will have to wait before cashing out his shares.
Under the terms of the merger, shareholders will be subject to a six-month lock-up period before they can sell or transfer their shares. The only exception is if the company’s board of directors resolves for a special exemption.
According to DWAC’s SEC filings, Trump Media lost $49 million in the first nine months of last year, on revenue of $3.4 million.
As Yahoo Finance’s Rick Newman points out, short interest in DWAC stock — bets that the stock price will fall rather than rise — was about 11% of the shares outstanding. For comparison, the average short interest for publicly traded companies is in the 3% to 4% range.
Former President Donald Trump waits for the start of pretrial hearings with his defense team in New York, Monday, March 25, 2024. (Associated Press)
Alexandra Canal is a senior reporter at Yahoo Finance. Follow her at Yahoo Finance. translatorvisit me on LinkedIn or email me at alexandra.canal@yahoofinance.com.
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