sThe hares of Trump Media & Technology Group, owner of the social networking site Truth Social, plummeted before the opening bell on Friday after former President Donald Trump was convicted in his silent trial.
A New York jury found Trump guilty of falsifying business records in a scheme to illegally influence the 2016 election through secret payments to a pornographic actor who said the two had sex.
Shares fell 9% immediately on Thursday in after-hours trading as news of the verdict emerged, and were down 5% on Friday morning.
The stock, which trades under the symbol “DJT,” has been unusually volatile since its debut in late March, joining the group of meme stocks that tend to ricochet from highs to lows as investors with small pockets try to capture an upward momentum swing at the right time.
Stocks have tripled this year, in the process often making double-digit percentage moves up or down in a single day. It reached a peak of nearly $80 in intraday trading on March 26. For context, the S&P 500 is up almost 10% year to date.
Meme stocks, including AMC Entertainment and GameStop, also fell on Friday, as did shares of social media companies, but Trump Media’s decline was at least double the decline of any stock in any sector before the bell. opening.
In a filing with the U.S. Securities and Exchange Commission before going public, Trump Media warned investors about the potential pitfalls facing the former president and the adverse effect this could have on the stock. “President Donald J. Trump is the subject of numerous lawsuits, the scope and scale of which are unprecedented for a former President of the United States and current candidate for that office. An adverse outcome in one or more ongoing legal proceedings in which President Donald J. Trump is involved could negatively impact TMTG and its Truth Social platform.”
Earlier this month, Trump Media reported that it lost more than $300 million last quarter, according to its first earnings report as a publicly traded company.
In the three-month period ending March 31, the company reported a loss of $327.6 million, which it said included $311 million in non-cash expenses related to its merger with a company called Digital World Acquisition Corp. known as a special purpose acquisition company, or SPAC, which can offer young companies faster and easier paths to getting their shares publicly traded, but with much less scrutiny.
Trump Media & Technology this month fired an auditor who federal regulators recently accused of “massive fraud.” The communications firm dismissed BF Borgers as its independent public accounting firm on May 3, delaying the filing of its quarterly earnings report.
Trump Media has previously had at least two other auditors — one who resigned in July 2023 and another who was fired by its board in March, just as it was rehiring BF Borgers.
Trump was charged with 34 counts of falsifying business records at his company in connection with an alleged scheme to hide potentially embarrassing stories about him during his campaign for the 2016 Republican presidential election.
The charge, a felony, arose from refunds paid to Trump’s then-attorney, Michael Cohen, after he made a secret $130,000 payment to porn actress Stormy Daniels to silence her allegations of an extramarital sexual encounter with Trump in 2006. Trump was accused of misrepresenting Cohen’s case. reimbursements as legal expenses to hide that they were linked to a secret payment.
Trump’s defense claimed that Cohen’s payments were for legitimate legal services.
This story originally appeared on Time.com read the full story
