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Shares of Trump Truth Social are worth $58 by the close of the first trading day on Wall Street

Shares of Trump Truth Social are worth $58 by the close of the first trading day on Wall Street

The parent company of Donald Trump's Truth Social platform began trading on Wall Street on Tuesday, with its shares appearing under the ticker “DJT” and priced at $78.

Its value fluctuated throughout the day before settling at around $70 Finishes at $57.99 The Nasdaq closing bell also rang.

Today's trading means that Trump has entered the list of the 500 richest people in the world, as he owns a majority stake in the company. It is now worth $5.5bn (£4.3bn)bringing his estimated net worth to more than $8 billion.

Shareholders in Trump's social network voted on Friday to take the company public, a move that could ultimately earn the former president tens of millions of dollars as he desperately tries to find money for court rulings against him.

Trump will need to find money from his own coffers or get help from an escrow company to post an appeal bond by Monday that would block a $454 million penalty after a New York judge found he defrauded banks and insurance companies.

His lawyers successfully convinced the state Court of Appeals to grant him a 10-day extension of his bond deadline and lower the expected amount to $175 million, with the lawyers arguing that finding the full amount proved a “practical impossibility,” with the order dismissed. Of about 30 bond companies will not take his valuable real estate empire as collateral.

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Political action committees backing the potential GOP nominee to take on President Joe Biden in November are also hemorrhaging tens of millions of dollars to pay his legal bills and attorneys' fees, months before the summer of criminal proceedings and the general election.

The public appearance by Trump Media & Technology Group, Truth Social's parent company, appears to have proven a massive boost to the former president's financial standing, but he won't see any immediate return.

On Friday, after delaying investigations by regulators and the US Department of Justice, Truth Social shareholders approved a long-awaited merger between Trump Media and publicly traded shell company Digital World Acquisition Corporation.

Under the terms of the agreement, Trump Media's major shareholders cannot sell their shares for six months. This requirement—usually used to prevent new public entities from signaling internal collapse or lack of confidence in the company's future—applies to a former president.

Trump owns a 60 percent stake in the company, which served as the de facto platform for his presidential campaign, raking in millions of dollars in free media coverage every time he released an incendiary post.

Wall Street values ​​Trump Media at $14 billion, but experts say that number is deeply flawed. Digital World Acquisition Corporation, which became Trump Media on Tuesday after the merger, has seen its stock price rise nearly 200 percent so far this year.

The high stock price and high valuation come even as Trump Media is losing money and as Truth Social is losing users.

Jay Ritter, a finance professor at the University of Florida, said: CNN“This is a very unusual situation. The stock is largely disconnected from fundamentals.

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A closer comparison would be so-called meme stocks like GameStop and AMC, which have soared during the pandemic amid a push from retail traders, he added. Mr. Ritter said Trump Media was likely worth about $2 a share — but after 10 a.m. Tuesday, it was trading at about $68.

“The core business doesn't seem to be worth much. There's no evidence that this is going to become a very large, profitable company,” Ritter told CNN.

“I'm reasonably confident that the stock price will eventually fall to $2 a share, and could even fall below that if the company blows away the money it got from the merger.”

In the first nine months of last year, Trump Media generated revenue of $3.4 million, but lost $49 million.

In its initial public offering last week, Reddit was valued at $6.4 billion although it brought in $804 million last year compared to $5 million for Trump's media outlets.

“At these levels, it appears to be unconstrained by its underlying business results,” Matthew Kennedy, a senior IPO strategist at Renaissance Capital, told CNN.

“Ultimately, valuations tend to lag behind fundamentals. That means this stock is definitely at risk of falling back to Earth.”