Trump Media & Technology Group stock (DJT) was briefly halted several times in early trading on Tuesday, but shares still managed to extend their five-week surge, rising nearly 10%.
The volatile stock moves come as investors bet on improved chances that Donald Trump will win the November presidential election, set for a week from Tuesday.
Tuesday's gains built on a more than 21% gain Monday following the former president and Republican nominee's highly criticized rally at Manhattan's Madison Square Garden (MSG) over the weekend. At current levels, the stock is trading at its highest level since May, with shares up about 270% from their September lows.
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Trump's rally sparked backlash from both sides of the political aisle after comedian Tony Hinchcliffe made inflammatory jokes about Latinos and the Black community, while anti-immigration comments also dominated headlines.
The surge in DJT stock is unlikely to continue beyond the short term. One current investor warned that if Trump loses the election next week, shares of DJT could plunge to $0.
"It's a binary bet on the election," Matthew Tuttle, CEO of investment fund Tuttle Capital Management, told Yahoo Finance's Catalysts show on Monday.
Tuttle, who currently owns put options on the stock, said the trajectory of shares hinges on "a buy the rumor, sell the fact" trading strategy.
"I would imagine that the day after him winning, you'd see this come down," he surmised. "If he loses, I think it goes to zero."
Shares in the company, the home of the Republican nominee's social media platform Truth Social, have seen a recent rise as both domestic and overseas betting markets shift in favor of a Trump victory, with prediction sites like Polymarket, PredictIt, and Kalshi all showing Trump's presidential chances ahead of those of Democratic nominee and current Vice President Kamala Harris.
National polls, however, show both candidates in an incredibly tight race, especially in key battleground states like Pennsylvania, Michigan, and Wisconsin, which are likely to decide the fate of the election.
The recovery in shares comes after the stock traded at its lowest level since the company's debut following the expiration of its highly publicized lockup period last month. Shares had also been under pressure as previous polling in September saw Harris edging slightly ahead of the former president.
Republican presidential nominee former President Donald Trump speaks at a campaign rally at Madison Square Garden, Sunday, Oct. 27, 2024, in New York. (AP Photo/Evan Vucci) ·ASSOCIATED PRESS
Tech billionaire Musk, who serves as the CEO of Tesla (TSLA) and SpaceX and also owns social media platform X (formerly Twitter), has been outspoken about his support of Trump ahead of next week's election. Trump has even said he would consider a Cabinet position for Musk but that the businessman likely would not be able to serve "with all the things he's got going on."
Musk attended Sunday night's MSG event, along with UFC president Dana White, former professional wrestler Hulk Hogan, and House Speaker Mike Johnson, among others.
Meanwhile, Harris has recently embarked on a flurry of media appearances in which she was pressed on how she would fund some of her proposals surrounding the economy and immigration. She appeared in Texas last week and was in Michigan on Monday, where she highlighted the Biden administration's CHIPS Act and its effects in the swing state.
Democratic presidential nominee Vice President Kamala Harris speaks during a community rally at the Alan Horwitz "Sixth Man" Center, Sunday, Oct. 27, 2024, in Philadelphia. (AP Photo/Susan Walsh) ·ASSOCIATED PRESS
Trump founded Truth Social after he was kicked off major social media apps like Facebook (META) and Twitter, now X, following the Jan. 6, 2021, Capitol riots. Trump has since been reinstated on those platforms. He officially returned to X in mid-August after about a year's hiatus.
But as Truth Social attempts to take on the social media incumbents, the fundamentals of the company have long been in question.
In August, DJT reported second quarter results that revealed a net loss of $16.4 million, about half of which was tied to expenses related to the company's SPAC deal. The company also reported revenue of just under $837,000 for the quarter ending June 30, a 30% year-over-year drop.
Earlier this month, the company revealed that its COO had stepped down in September.
Trump maintains a roughly 60% interest in DJT. At current levels of around $52 a share, Trump Media boasts a market cap of about $10.3 billion, giving the former president a stake worth around $6.2 billion.
