- Trump’s media company debuted on NASDAQ on Tuesday after merger
- Trump’s own worth increased by a staggering $4 billion
- Stock price is 2,000 times the company’s revenue last year
Donald Trump’s new media company ended its first active day of trading valued at $8 billion (more than established firms like the New York Times and Mattel) amid warnings that investors were putting their money into Trump instead. instead of in the company itself.
At one point during the heat of its first day of trading on the NASDAQ, the company that owns Truth Social was valued at $10 billion, despite having just $3 million in revenue for the first nine months of last year.
Even after the stock price cooled to $57.99, the company was worth more than companies with many users and established track records.
The Times, founded in 1851 and reported In the company’s commercial debut, which estimated its value higher than that of Barbie maker Mattel, it is valued at around $7 billion.
Its share price is approximately 2,000 times revenue.
Former President Donald Trump’s media company was valued at $8 billion at the close of trading Tuesday after its debut on the NASDAQ.
Online message board Reddit, which made its own splashy debut days ago, has a similar market capitalization but has 268 million active users. Its value was less than ten times its income.
Watchdogs are already warning that Trump’s huge stake in the company presents an opportunity for influence, even beyond the ethical issues that arose when he decided not to sell his empire when he was elected in 2016 or place assets in a blind trust.
‘Truth Social has also not reached its projected user base by an order of magnitude. It is not a successful company. It is not a company that seems to have a successful plan to make money. “It’s essentially just a meme,” Jordan Libowitz of Citizens for Responsible Ethics in Washington.
“So it’s all based on what people invest their money in,” Libowitz told DailyMail.com.
“It’s not really Truth Social, they are investing in a potential future president of the United States – their net worth – is controlled by whether people buy or sell shares.” Now, a foreign investment fund like Saudi Arabia or Qatar can buy a large amount of it, increase its net worth, threaten to sell it to reduce its net worth, and have extreme influence over the president of the United States.
Shares rose again on Wednesday after closing at $57.99. It is valued at approximately 2,000 times earnings.
Watchdog groups warn of potential opportunities for influence if the president’s wealth is tied to the company.
Trump remains dependent on his supporters not only for potential votes (he leads in polls against President Biden) but also for campaign contributions to pay his legal bills and other purchases. On Tuesday he began selling Bibles with American singer God Bless the USA, Lee Greenwood.
There are around 9 million Truth Social account holders, but only 5 million active users. The former Twitter, now X, which reinstated Trump after suspending his account after January 6, has 550 million.
Although purchases in public markets can be a blunt instrument, the dollars at stake are much larger than when Trump was under the microscope as foreign governments, embassies and companies booked rooms at his former luxury hotel in Washington, D.C. while he was in the power. White House.
Trump’s stunning financial gains from the tender offer come as his legal bills and court rulings pile up. A New York appeals court this week gave him 10 days to pay a $175 million judgment in his fraud case while he appeals.
Trump’s shares are currently locked up, so he can’t sell them for six months unless a board of directors packed with loyalists votes to allow it. But that could subject board members to potential lawsuits from shareholders if the move is seen as sacrificing company value.
