Shares of Trump Media & Technology (DJT -2.56%) missed out on the "Trump Trade" last month as the stock briefly popped after the election but then gave up those gains in what seemed to be a "buy the rumor/sell the news" event.
Trump Media & Technology, which owns Truth Social, brings in almost no revenue, and the stock became something of an avatar for the Trump campaign before the election. Now that he's won, investors seem unsure what to make of the stock. Additionally, the stock moved on reports that it was in talks to buy a cryptocurrency trading platform. Overall, the stock finished the month down 11%, according to data from S&P Global Market Intelligence.
As you can see from the chart below, the stock swung up and down over the month, though it traded in negative territory for nearly the entirety of the month.
Trump Media whiffs on the election
Most investors in Trump Media stock probably expected the stock to go up after the election, and that did happen briefly. Shares of Trump Media initially surged on Nov. 6, the day after the election, and they cooled off to finish that session up 6%. However, they plunged the following day as it seemed there was no direct benefit to Trump's winning the White House, and they would remain below their closing price the day before the election for nearly the rest of the month.
The other big piece of news out on the company was that it was in advanced talks to buy Bakkt, a publicly traded cryptocurrency trading platform that's majority owned by IntercontinentalExchange, according to Financial Times.
The news outlet said the deal would be an all-stock purchase. The valuation was unclear, but Bakkt's market cap is currently $155 million. That report dovetails with Trump's recent embrace of crypto, and Trump Media is also considering launching its own crypto payment service, according to The New York Times.
Image source: Getty Images.
What's next for Trump Media
At this point, Trump Media seems to be a call option on the power of the Trump name and the company becoming something more than the business currently is, as Truth Social is not a significant revenue driver.
Trump Media is launching a streaming service, but the crypto play is intriguing and a good way for the company to leverage the power of the Trump name and his followers.
Until the business starts generating material revenue, investors should be skeptical of the stock, but there is potential for the company here if it can leverage the value of its stock into a real business.
