Valued at a market capitalization of $7.3 billion, Trump Media & Technology (DJT) operates Truth Social, a social media platform launched in 2022 as an alternative to more mainstream platforms like Facebook and Instagram. DJT stock went public through a special purpose acquisition vehicle (SPAC) merger with Digital World Acquisition.
Headquartered in Sarasota, Florida, and largely owned by President Donald Trump, TMTG has shown considerable volatility. This reflects both market dynamics and operational challenges as the company works to establish itself in the competitive social media landscape.
While the broader markets are trading near all-time highs under the new Trump administration, TMTG has struggled to maintain momentum. The stock fell 11% Jan. 21, the first trading day after his inauguration, and it is down nearly 60% from its 52-week high. While Truth Social has gained prominence as a channel for presidential communications, investors appear to be shifting their focus to companies more directly benefiting from Trump’s policy decisions.
It suggests that investors are prioritizing tangible policy impacts over the sentiment-driven trading that previously supported TMTG's stock price. So, let’s see if you should buy DJT stock at the current valuation.
Is DJT a Good Stock to Own in January 2025?
TMTG ended the third quarter of 2024 with a cash position of $672.9 million and no debt. However, it reported an operating loss of $23.7 million and a net loss of $19.2 million for the quarter. The losses included significant one-time expenses, including $12.1 million in legal fees related to recent acquisitions and mergers and $3.9 million in research and development.
TMTG emphasized that the September quarter was marked by a major expansion into streaming services through Truth+. The expansion included the development of a proprietary content delivery network and the release of applications across multiple platforms (iOS, Android, and connected TV systems). The company views this streaming initiative as a major driver of future earnings and shareholder value.
However, Trump Media & Technology reported revenue of just $1 million in Q3 of 2024, primarily from early stage advertising on Truth Social. Its ad revenue was supplemented by $4.7 million in interest income.
What Is Next for DJT Stock?
Looking ahead, TMTG plans to continue expanding its Truth+ streaming service with additional platform support and content offerings. TMTG further stated that it will continue to explore potential mergers and acquisitions, particularly in the fintech space.
The company believes its current cash position provides sufficient working capital for the foreseeable future.
It’s likely that TMTG will acquire companies and diversify its revenue streams over the next few years. However, it remains unprofitable and is priced at an extremely lofty valuation with a trailing price-sales ratio above 1,000x, making DJT a risky stock to own in 2025.
