As I write this article, Trump Media & Technology Group Corp. (DJT) is up 7.90% today, making it one of the biggest gainers in the market. The stock has been on a wild ride lately, with some investors piling into the company’s shares after its announcement to partner with Crypto.com to launch ETFs.
But before you jump into this hot stock, let’s take a closer look at what’s driving DJT’s recent surge and whether it’s worth considering for your portfolio.
The Partnership with Crypto.com
Trump Media & Technology Group has signed a non-binding agreement with Crypto.com to partner on the development of exchange-traded funds (ETFs) through its Truth.Fi brand. The ETFs will include digital assets, as well as securities focused on American companies and industries such as energy. This partnership is expected to be widely available internationally, including in the United States, Europe, and Asia.
While this news has certainly generated excitement among investors, it’s essential to remember that DJT’s financial performance has been a concern for some time now. The company reported a net loss of $400.86 million last year, with an operating margin of -5,140.90%. That’s not exactly what you want to see in a stock.
The Risks and Benefits
So, is DJT worth considering? On one hand, the partnership with Crypto.com could bring new revenue streams and help diversify the company’s business model. Additionally, Trump Media & Technology Group has been working on expanding its financial services offerings through Truth.Fi, which might appeal to investors looking for a more comprehensive platform.
On the other hand, DJT still faces significant challenges in terms of profitability and cash flow generation. The company’s net income before taxes was -$400.86 million last year, with an EPS (diluted) loss of $3.97 per share. That’s not exactly what you want to see when considering a stock for investment.
The Verdict
While DJT has had a significant gain today, it’s essential to approach this stock with caution. While the partnership with Crypto.com is certainly exciting news, investors should be aware of the company’s financial struggles and consider these risks before making any decisions.
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Disclaimer: This article is for informational purposes only and should not be considered as a buy or sell recommendation. Always do your own research before making any investment decisions.
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