Former President Donald Trump’s net worth saw a slight recovery above $4 billion on Thursday, fueled by a surprise rebound in shares of his social media company Truth Social’s parent company. However, Trump is still far from the peak value of his assets, which was over $6 billion shortly after his company went public.
In mid-April, Trump’s net worth surged to $4.5 billion as shares of Trump Media climbed over 25% to $33. This increase was largely driven by a spike in the value of his social media holdings, sparking speculation of a short squeeze on the company’s shares. The rally came after the company issued a notice to shareholders on how to prevent their shares from being used in short trades, which bet on a decrease in share prices.
Just a day earlier, Trump’s fortune had grown by almost $300 million to $3.9 billion as Trump Media shares recorded their best single-day gain since late March. Despite this increase, Trump’s stake in the company remained a fraction of what it was just three weeks prior, standing at $2 billion. In mid-April, Trump’s net worth took a hit as shares of Trump Media fell by 14%, leading to a significant drop in the value of his social media investments.
The decline in Trump’s net worth can be traced back to early April when Trump Media’s market value plummeted below $5 billion, down from its peak of over $10 billion just two weeks earlier. On March 26, Trump saw a substantial increase in his net worth following Trump Media’s first day of trading as a publicly listed stock, which brought his net worth to $6.4 billion. However, the company’s share price later dropped significantly, impacting Trump’s overall wealth.
The launch of Truth Social in 2022 came during Trump’s suspension from mainstream social media platforms following his controversial posts leading up to the Capitol riots. Trump Media, the parent company of Truth Social, went public through a merger with Digital World Acquisition Corp. in a bid to capitalize on the SPAC craze, which has since waned. Trump’s paper gains from Trump Media’s listing came at a crucial time as he faces mounting legal troubles, including a criminal trial in New York and a $175 million bond posting.
Despite the surge in his net worth on paper, Trump is currently unable to cash in on his Trump Media stake due to federal regulations. The company’s recent filing to publicly list more shares may provide an opportunity for Trump to sell his stake, although the current valuation of his social media holdings suggests they may be significantly overvalued. With a market capitalization of $4.1 billion and minimal revenue of $4.1 million in the previous year, Trump Media’s price-to-sales ratio is considerably higher than the average S&P 500 company, indicating potential risks for further declines in value.
