Fox Business host Stuart Varney predicted Tuesday a dire future for Truth Social’s stock if President Joe Biden were to win reelection in November.
Former President Donald Trump has the potential to earn billions of dollars after shareholders of Digital World Acquisition Corporation (DWAC) voted to approve a merger Friday with Trump Media & Technology Group (TMTG). Despite the stock price of Truth Social’s parent company surging during the early hours of its first official day of trading, Varney warned that the stock’s success could be temporary and may tank if Trump does not win the presidency.
“Are people buying this company, this stock, because they think it has got inherent value or because they want to demonstrate support for Donald Trump?” Varney asked market commentator Scott Shellady.
“I think you’re probably on to something there, Stuart,” Shellady said. “It’s probably more the second thing you mentioned, because it’s going to be hard if you look at it in comparison to say, Reddit or other places. They are not making the money yet. Maybe they do in the future, but it is hard to justify the valuation with what we’ve seen today.”
“You know, on Facebook he has some 34 million followers. On Twitter he’s got 78 million. But on Truth Social he’s got 6.6 million, so maybe that takes a little teeth out of that argument as well,” Shellady continued. “So it’s gonna have to play out. There is some euphoria, some ‘Donald Trump may be elected president’ here, but when it comes down to valuation, these things typically will overshoot the mark the first few days.” (RELATED: ‘That’s An Interesting Point’: Fox Host Harris Faulkner Amazed By Guest’s ‘Ruby Red Slipper’ Defense Of Trump)
“I think it’s almost like a meme stock, and that’s the way it’ll play out,” Varney said. “It’s a bet on whether Trump wins or loses in November of this year. If he loses, I think the stock goes way down. If he wins, I mean, it looks like he’s going to win, I think the stock does well because then Truth Social will do well.”
Trump is set to become one of the 500 richest people in the world after his social media company began public trading Tuesday, according to a Monday report by Bloomberg News.
The former president achieved a legal victory in his civil fraud case Monday when an appeals court agreed to reduce his bond from $454 million to $175 million.