Short sellers seem to be closing in on Trump Media & Technology Group (DJT) stock. The parent company of Truth Social, of which Donald Trump is a primary shareholder, has been volatile lately as the 2024 U.S. presidential election draws closer. With Trump’s political future hanging in the balance, short interest in the stock that bears his initials is rising.
What does this mean for the future of DJT stock? Let’s take a closer look at this trend and discuss what investors should expect from the firm as the election approaches.
What’s Happening with DJT Stock?
DJT stock had pulled back into the green today but failed to stay elevated, as it finished down on the day. Shares may have risen this week, but short interest in the stock is also high. Data from Fintel shows that it accounts for roughly 18% of the stock’s float. Additionally, as of this writing, there are no DJT shares available to short.
This suggests that short interest in DJT stock is indeed high. Political betting markets may be indicating that a Trump victory is likely but that doesn’t mean that all investors are optimistic about the stock’s chances of long-term growth. Earlier this week, Nasdaq halted trading for DJT due to extreme volatility, something the stock is subject to, even when Trump’s political prospects are rising.
It is for these reasons, TipRanks contributor Joel Baglole writes, that DJT is often treated as a meme stock by traders and analysts. Bernard Zambonin recently compared it to other meme stocks Gamestop (GME) and AMC Entertainment (AMC), noting that it isn’t even the strongest bet among three struggling companies.
Is It Time to Sell DJT Stock?
Due to this meme stock status, Wall Street has issued no ratings or price predictions on DJT stock. The company’s future remains uncertain, largely due to the fact that it moves alongside Trump’s political prospects. Even as his content has kept Truth Social in full focus, the stock has failed to demonstrate stable growth.
For short sellers, DJT stock could provide a tempting play as the election continues to impact financial markets. Conditions will likely be chaotic as the close election generates chaos and uncertainty. However, recent trends suggest that short sellers believe that DJT will continue to trend downward.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
