Why Trump media stock is rising again today

Trump Media (DJT 17.40%) Stocks are posting big gains again in Tuesday’s trading. The company’s stock price is up 19.6% since 2:00 PM ET and is now up 33.5% over the past week.

Trump Media shares continue to see bullish momentum adze CEO Elon Musk’s appearance at a presidential campaign rally for Donald Trump over the weekend. The social media company’s stock price may also gain ground thanks to buying from meme stock investors and short momentum.

Trump Media benefits from the rising status of meme stocks

Elon Musk’s campaign rally in Butler, Pennsylvania over the weekend appears to have given Trump Media’s meme stocks a boost. Musk has previously been influential in promoting meme-based rallies for cryptocurrencies, including Dogecoin and Shiba Inuand it looks like the Tesla CEO and X’s support for Donald Trump is now generating big gains for Trump Media stock.

Following the company’s recent share price gains, Trump Media stock could also benefit from moderate shorting. While short interest on the stock isn’t particularly high, the explosive gains could prompt some short sellers to cut their losses by buying back shares. In turn, this could push the company’s stock price even higher.

What’s Next for Trump Media Stock?

Even after a recent surge in bullish momentum, shares of Trump Media are still down about 67% from the high they hit shortly after going public through a merger with a special-purpose buyout company (SPAC) earlier this year. As the company has recently attracted increased attention from meme stock investors, its share price is likely to continue to make large upward moves in the near term. For better or worse, developments in the presidential race are also likely to have a significant impact on short-term stock performance.

In terms of long-term catalysts, the picture is less clear. While Trump Media has made its Truth Social media platform the centerpiece of its business, the service appears to be attracting relatively low levels of engagement and hasn’t generated much revenue. In the second quarter, Trump Media reported revenue of just $828,000 and a net loss of $16.4 million.

For a company launching and expanding social media and streaming services, the losses actually seem pretty small. There’s a good chance the business will have to increase spending significantly if it hopes to find a lasting foothold in the highly competitive technology and media categories.