Trump Media Stock Surges Again Amid Battle Against Short Sellers

Trump Media Stock

Trump Media & Technology Group (NASDAQ:DJT) stock saw a significant increase for the second consecutive day, jumping by as much as 15% on Thursday as the company took steps to combat short sellers amidst a volatile trading week.

According to an updated FAQ page on the Trump Media website, the company is guiding investors on how to prevent their shares from being loaned for short-interest positions, as short interest in DJT stock currently stands at approximately 13% of outstanding shares.

Trump Media went public on the Nasdaq following its merger with special purpose acquisition company Digital World Acquisition Corp. Shares have experienced a decline of about 55% since the end of March.

The company advised investors to contact their brokerage firms to restrict the lending of their shares to short sellers and recommended opting out of any securities lending programs. Additionally, investors were encouraged to hold DJT shares in a cash account at a brokerage firm rather than a margin account and to transfer shares to a bank for holding in a retirement account.

Despite recent struggles, Trump Media maintains a market cap of roughly $4 billion, with former President Trump holding a stake worth around $2.4 billion. The company’s flagship platform, Truth Social, was founded by Trump after being banned from major social media platforms following the Jan. 6 Capitol riots in 2021.

However, Trump Media reported sales of just over $4 million and net losses of nearly $60 million for the full year ending Dec. 31. The company warned of ongoing profitability challenges, and stakeholders remain subject to a six-month lockup period before selling or transferring shares.

In addition to financial challenges, Trump faces legal battles, including a $454 million fraud penalty and a criminal trial related to alleged payments to adult film star Stormy Daniels. Despite these hurdles, Trump recently posted a $175 million bond in the fraud case, delaying the final payment while he appeals the verdict.

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