Dominari Holdings (DOMH) experienced a dramatic surge in its stock price earlier this week after the company announced that President Donald Trump’s sons, Donald Trump Jr. and Eric Trump, have joined its advisory board.
The stock soared more than 90% higher on Monday, Feb. 10 and added another 21% on Tuesday, Feb. 11. As a microcap company with a market capitalization of roughly $43.5 million, Dominari operates in verticals such as wealth management, investment banking, and sales and trading through its subsidiaries.
Both Donald Trump Jr. and Eric Trump participated in a recent private placement funding round in the company. On Tuesday, Dominari announced a $13.5 million registered direct and private placement offering, while its board declared a special cash dividend of $4 million.
Dominari CEO Kyle Wool indicated that his firm actively seeks investment opportunities, particularly in artificial intelligence and data centers. In a statement, Trump Jr. emphasized the transformative potential of AI, and highlighted the need for significant capital investment and strategic planning in his new role at Dominari.
The appointment adds to Trump Jr.’s growing portfolio of corporate board positions since his father’s election victory. In December, Trump Jr. joined the board of PSQ Holdings (PSQH), which owns the online marketplace PublicSquare.
He is also a board member of Unusual Machines (UMAC), a small U.S. drone and drone component manufacturer. Additionally, in November, Trump Jr. joined venture capital firm 1789 Capital as a partner, where he works with a firm focused on investing in conservative-oriented products and companies, including Tucker Carlson’s media company.
How Did Dominari Holdings Perform in Q3 2024?
Starting in 2017, Dominari focused on biotechnology, with small-molecule anticancer therapies and antiviral therapeutics in its pipeline. Over the last year, however, it has been transitioning into a fintech and financial services firm via subsidiaries Dominari Financial and Dominari Securities. According to its 10-Q filing for the third quarter of 2024, Dominari reported revenue of $4 million compared to $963,000 in the year-ago period. In the first nine months of 2024, its sales totaled $11.6 million, up from $1.03 million in the prior year.
Dominari posted a net loss of $4.2 million in Q3 and $15.8 million over the last three quarters. As of Sept. 30, 2024, it maintained a cash position of $3.4 million, total assets of $43.4 million, and shareholder equity of $38.3 million.
The company’s revenue growth is primarily driven by underwriting services ($6.4 million YTD) and commissions ($3.2 million YTD). However, Dominari continues to face challenges with its investment portfolio, recording significant losses on long-term equity investments ($6.4 million write-down YTD) and notes receivable ($2.1 million loss YTD).
Notable developments during the period include a new joint venture with Heritage Strategies in May 2024 to offer insurance products, investments in AI-focused companies (xAI, Cerebras, and Groq) through its Master SPV structure, material write-downs of investments in companies like Tevva Motors ($2.8 million) and Thrasio, and ongoing legal proceedings related to the hiring of registered representatives in March 2024.
Dominari disclosed a material weakness in internal controls regarding accounting for specific notes receivable and long-term investments. Management is implementing remediation measures, including engaging external specialists and enhancing internal processes. Despite operating losses, the management believes current cash and marketable securities can fund operations for at least 12 months.
