投行机构自由资本市场（Freedom Capital Markets）的首席全球策略师杰伊·伍兹在接受媒体采访时表示，① The stock price of Trump Media has fallen by 70% since its listing; ② Even after a significant sell-off, the market cap of the company is still around $3 billion; ③ An expert stated that the current market cap is still too high.
CLC News, September 30th (Editor Chun Bian) With the rising popularity of Harris, who is taking over Biden's campaign for the US president, the once highly praised 'Trump trade' is gradually fading. The stock price of Trump Media & Technology Group, Trump's media company, has fallen by 70% since its listing.
But even after a significant sell-off, Trump Media's market cap is still around $3 billion. An expert stated that this number is still too high.
Jay Woods, Chief Global Strategist at Freedom Capital Markets, stated in a media interview that the valuation of Trump Media is 'unreasonable'. He pointed out that according to the data, the company's 'last quarter revenue was $0.837 million, while the net loss was as high as $16.4 million.'
From a traditional valuation indicator perspective, Trump Media's p/s ratio is currently 1864 times, with the company's revenue in the past 12 months being less than $2 million.
In addition to the astonishing valuation, Woods also pointed out that the growth space of Trump Media's social platform Truth Social is limited.
"They are struggling in user retention and growth, the growth space seems limited - especially if he (Trump) loses in the election." Woods stated.
Another lingering issue affecting Truth Social's stock price is that Trump is increasingly using his biggest competitor X (formerly Twitter), showing less focus on Truth Social.
In addition, the lock-up period for insiders selling Trump Media stocks has recently ended, which may bring further pressure to the stock.
One of the largest shareholders of Trump Media, Atlantic China Welding Consumables,Inc., almost cleared its shares after the lock-up period ended.
Although Trump stated earlier that he would not sell the stock after the lock-up period ends, nobody can guarantee that he will not change his mind. Currently, Trump holds 57% of the company's shares.
"If the largest shareholder sells a large number of shares, it may trigger panic among other internal shareholders, leading to a significant drop in the stock price," Woods said.
