The social media company associated with Donald Trump has experienced a significant recovery following a period of decline, which had caused the stock price to drop by 50% and left shareholders feeling unsettled.
Trump Media Shares Plummet as Early Investors Sell Off Stock
Shares of Trump Media & Technology Group experienced a significant drop last week due to the news of potential early investors selling a large number of shares.
Trump Media had previously cautioned that this could lead to a notable decrease in the stock's public trading price.
The recent development has only contributed to the existing uncertainty surrounding the stock of Trump Media, CNBC reported.
This uncertainty has been present since the company began trading in March following its merger with Digital World Acquisition Corp, a shell company.
Trump Media Expects $69.4 Million from Recent Warrants Amid Stock Volatility
According to USA Today,Trump Media announced on Friday that it anticipates generating over $69.4 million in proceeds from the warrants exercised during the past two days.
Meanwhile, selling short on Trump Media continues to be a risky and expensive endeavor.
According to financial data firm S3 Partners, borrowing this stock in the U.S. comes at a high cost, making it the most expensive option.
Unfortunately, those who have sold the stock short have experienced significant losses this year, amounting to approximately $178 million in mark-to-market losses.
Following a lengthy public merger with a special purpose acquisition company in March, the recently formed Trump Media experienced a significant surge in its frenzied Nasdaq debut, with double-digit gains.
However, the stock's promising rise to $79.38 per share was abruptly followed by a sharp decline, plummeting to a mere $22 per share.
The stock of Trump Media has been experiencing significant fluctuations, despite the company's recent quarterly earnings report showing a net loss of $327.6 million on revenues of just $770,500.
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