From DWAC to DJT: Unraveling the tale of Trump Media’s $9 billion valuation

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on Mar 26, 2024
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  • Part of Trump's business empire is set to go public as Trump Media & Technology Group, owner of Truth Social.
  • Shares of Digital World Acquisition Corp., which is set to become Trump Media, have surged nearly 200%.
  • Market enthusiasm drives shares up by another 8% in premarket trading.

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After nearly 30 years, a portion of Donald Trump’s business empire is set to go public as Trump Media & Technology Group, owner of Truth Social.

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The debut on the stock market will be under the ticker symbol “DJT.”

Wall Street’s valuation

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Despite concerns from experts, Trump Media is being assigned a staggering valuation of approximately $9 billion by Wall Street.

This valuation, however, is raising eyebrows, with experts warning that it may not accurately reflect the company’s fundamentals.

DWAC’s spiking share price

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Shares of Digital World Acquisition Corp., which is set to become Trump Media, have surged nearly 200% this year, including a 35% spike on Monday following the deal closure.

The market’s enthusiastic response is fueling further gains, with shares climbing an additional 8% in premarket trading.

Challenges facing Truth Social

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Despite the hype surrounding Truth Social, the platform faces significant challenges, including dwindling user numbers and fierce competition from established rivals like Twitter and Facebook.

Its shrinking user base, coupled with declining website traffic, underscores the uphill battle ahead for the fledgling social media platform.

DJT’s future in question?

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Trump Media’s future is closely tied to Donald Trump himself, raising concerns about keyman risk and the company’s reliance on his leadership and popularity.

Trump’s legal troubles and the expiration of lock-up restrictions on insider shares pose further uncertainties for the company’s share price.

Given Trump’s history of bankruptcies and the speculative nature of the current valuation, experts urge caution for investors.

Implications of going public

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The decision to go public represents a multi-billion dollar bet on a potential second Trump term, with Truth Social positioned as a primary means of presidential communication in such a scenario.

However, the outcome remains uncertain, with Trump Media’s future trajectory dependent on a myriad of factors, including user growth, regulatory challenges, and political dynamics.

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