Analysis of Trump Media's Stock Plummet
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 6 days ago
0mins
Source: NASDAQ.COM
- Core Business Decline: Trump Media's primary revenue source, Truth Social, has not disclosed its monthly active user count, which was only 6.3 million in January 2025, indicating stagnant user growth and leading to a projected revenue drop to $3.6 million in 2024, with a staggering net loss of $401 million, severely impacting the company's financial health.
- Valuation Imbalance: Despite a market cap of $3.7 billion, Trump Media's valuation exceeds 1,000 times its sales, starkly contrasting with Rumble's 4 times sales valuation, indicating a significant overvaluation and exposing investors to substantial downside risk.
- Failed Cryptocurrency Strategy: The company has invested in Bitcoin and Cronos tokens over the past year and issued private
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Analyst Views on DJT
About DJT
Trump Media & Technology Group Corp. (TMTG) is a social media and technology-focused company. The Company's product, Truth Social, is a social media platform where any user can create content, follow other users and engage in an open global conversation. The Company does not restrict whom a user can follow. Additionally, users can be followed by other users without requiring a reciprocal relationship, enhancing the ability of its users to reach a broad audience. Its products and services include Truth Social and Truth+. TMTG operates a TV streaming platform, Truth+, across the entire Truth Social platform-iOS, Android, and the Web. The streaming service relies on TMTG's custom-built content delivery network (CDN), which operates through a data center. TMTG's streaming technology is powered through specially designed infrastructure with its own servers, routers, and software stack. The Company is also focused on launching Truth.Fi, a financial service and FinTech brand.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Market Volatility: The S&P 500 recorded its largest drop since January, with approximately $800 billion wiped from market value in a single session, reflecting the market's negative response to uncertainties surrounding the Iran situation.
- Rising Treasury Yields: The 10-year Treasury yield hovers near 4.39%, with analysts warning that rising yields pose a greater risk to equities than energy prices, highlighting investor concerns about future economic prospects.
- Iranian Legislative Moves: Iran is drafting legislation that could impose fees on vessels seeking passage through the Strait of Hormuz, a key global oil transit route that has seen a significant drop in traffic since late February, further exacerbating market uncertainties.
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- Stagnant User Growth: Despite promoting Truth Social as a conservative alternative, the platform only reported 6.3 million monthly active users in January 2025, significantly trailing behind competitors like Rumble, which boasts 52 million, reflecting stagnation in its core business.
- Deteriorating Financials: Revenue is projected to drop from $4.1 million in 2023 to $3.6 million in 2024, while net losses are expected to soar from $58.2 million to $401 million, highlighting financial strain from high stock-based compensation and legal expenses.
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Analysis of Trump Media's Stock Plummet
- Core Business Decline: Trump Media's primary revenue source, Truth Social, has not disclosed its monthly active user count, which was only 6.3 million in January 2025, indicating stagnant user growth and leading to a projected revenue drop to $3.6 million in 2024, with a staggering net loss of $401 million, severely impacting the company's financial health.
- Valuation Imbalance: Despite a market cap of $3.7 billion, Trump Media's valuation exceeds 1,000 times its sales, starkly contrasting with Rumble's 4 times sales valuation, indicating a significant overvaluation and exposing investors to substantial downside risk.
- Failed Cryptocurrency Strategy: The company has invested in Bitcoin and Cronos tokens over the past year and issued private
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- Oil Price Surge: Brent crude prices remain above $107 and WTI above $93, driven by risks in the Strait of Hormuz, indicating that geopolitical tensions are directly impacting energy markets as prices surged in March.
- Market Volatility: The S&P 500 recorded its largest drop since January, with approximately $800 billion wiped from market value in a single session, reflecting the market's negative response to uncertainties surrounding the Iran situation.
- Rising Treasury Yields: The 10-year Treasury yield hovers near 4.39%, with analysts warning that rising yields pose a greater risk to equities than energy prices, highlighting investor concerns about future economic prospects.
- Iranian Legislative Moves: Iran is drafting legislation that could impose fees on vessels seeking passage through the Strait of Hormuz, a key global oil transit route that has seen a significant drop in traffic since late February, further exacerbating market uncertainties.
See More
Democratic Victory in Trump's Home District Signals Midterm Vulnerability
- District Flip: Democratic candidate Emily Gregory's victory in the Florida special election flips a district previously held by Republicans, indicating strong momentum for Democrats ahead of the midterms.
- Voter Sentiment: Gregory's win over Trump-endorsed Republican Jon Maples reflects voter dissatisfaction with rising gas prices and grocery costs, which could significantly impact future election outcomes.
- Strategic Implications: DNC Chairman Ken Martin emphasized that winning in Trump's 'backyard' signals potential victories nationwide, highlighting the strategic importance of the upcoming midterm elections.
- Future Outlook: Gregory plans to run for a full two-year term in November, showcasing the Democrats' intent to expand their influence in Florida, potentially reshaping the state's political landscape and affecting the 2026 elections.
See More
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- Poor IPO Performance: Trump Media went public through a SPAC merger on March 26, 2024, opening at $70.90, but has since fallen to below $9, indicating a pessimistic market outlook on its future prospects.
- Stagnant User Growth: Despite promoting Truth Social as a conservative alternative, the platform only reported 6.3 million monthly active users in January 2025, significantly trailing behind competitors like Rumble, which boasts 52 million, reflecting stagnation in its core business.
- Deteriorating Financials: Revenue is projected to drop from $4.1 million in 2023 to $3.6 million in 2024, while net losses are expected to soar from $58.2 million to $401 million, highlighting financial strain from high stock-based compensation and legal expenses.
- Severely Overvalued: With a market cap of $3.7 billion, Trump Media is valued at over 1,000 times its sales, compared to Rumble's 4 times, suggesting that Trump Media's stock could plunge by 99% and still be considered expensive, prompting investors to seek better-managed social media alternatives.
See More
Analysis of Trump Media's Stock Plummet
- Core Business Decline: Trump Media's primary revenue source, Truth Social, has not disclosed its monthly active user count, which was only 6.3 million in January 2025, indicating stagnant user growth and leading to a projected revenue drop to $3.6 million in 2024, with a staggering net loss of $401 million, severely impacting the company's financial health.
- Valuation Imbalance: Despite a market cap of $3.7 billion, Trump Media's valuation exceeds 1,000 times its sales, starkly contrasting with Rumble's 4 times sales valuation, indicating a significant overvaluation and exposing investors to substantial downside risk.
- Failed Cryptocurrency Strategy: The company has invested in Bitcoin and Cronos tokens over the past year and issued private
See More
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- Career Overview: As the second-longest-serving FBI director, Mueller played a crucial role in counterterrorism and major criminal cases, shifting the FBI's focus to combating terrorism after the 9/11 attacks, thereby enhancing national security.
- Political Controversy: Mueller's investigation sparked fierce opposition from Trump and his supporters, who labeled it a 'witch hunt,' and Trump's inappropriate remarks following Mueller's death highlight the ongoing political divide.
- Legacy and Influence: Mueller's passing marks the end of an era, with his investigation leaving a lasting impact on Trump's presidency and contributing to deep political divisions in the U.S., which may continue to influence related laws and policies in the future.
See More
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- Five Below Options Activity: Concurrently, Five Below Inc (Ticker: FIVE) experienced an options trading volume of 11,513 contracts today, translating to approximately 1.2 million shares, which is 117.9% of its average daily trading volume of 976,715 shares over the past month, reflecting active market interest in its stock.
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See More
