Stay ahead with real-time Wall Street scoops.

Trump's Truth Social Is Surpassing X in Valuation Amid 'Trump Trade' Frenzy

Word on the StreetWednesday, Oct 30, 2024 4:39 am ET

1min read

As the price of Trump Media & Technology Group (TMTG) has been surging, Trump's Truth Social, the social media platform founded by the former U.S. President, has also seen a jump in its valuation and has exceeded that of its biggest competitor, the X platform owned by the world's richest man, Elon Musk.

As of Tuesday, the stock price of TMTG, the parent company of Truth Social, has soared by 333% from its low point in late September, with the valuation climbing to $10.6 billion.

While Fidelity Investment, which holds shares in X, regularly updates its valuation expectations for the social media platform, its latest valuation for X is only $9.4 billion. Since Musk's acquisition of X for a high price of $44 billion in October 2022, the platform's valuation has decreased by 79%.

TMTG's valuation of $10.6 billion also makes it more valuable than The New York Times, which is valued at around $9.2 billion.

In most people's views, the surge in TMTG's valuation is not based on fundamentals but is related to the chances of Trump winning the presidential election.

On the eve of the U.S. election, the Trump Trade heated up dramatically, as investors believed that Trump had a high chance of returning to the White House. Betting market odds show that Trump's chances of winning the election are far higher than Harris's.

After Trump held a significant campaign rally at Madison Square Garden in New York over the weekend, the stock price of TMTG began a meme-like rebound. On Tuesday, however, the stock was halted multiple times due to violent fluctuations.

According to the 10-Q filing submitted by TMTG to the U.S. Securities and Exchange Commission, the company's revenue for the first half of 2024 was only $1.6 million, with a loss of $344 million.

Trump himself is also a big winner in the heating up of the Trump Trade. According to data from Bloomberg, his net worth has almost doubled in the past few months, reaching over $8 billion, mainly driven by the rise in TMTG's stock price.

As of Tuesday, Trump holds nearly 115 million shares of TMTG, valued at about $6.2 billion.

Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.