In what may be the most mind-boggling loss I have seen in, well, at least today, Truth Social (DJT) announced that it was planning a stock buyback backed up by a nine-figure war chest. Normally this is the kind of thing that makes investors super happy—fewer shares on the market means the ones still left are more valuable almost by default—but this time, it simply did not hit home. Truth Social shares slipped nearly 1.5% in Monday afternoon’s trading.
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The board of directors approved a stock buyback with as much as $400 million behind it, and is set to include both common stock and warrants in its purview. Repurchased shares would reportedly be “retired,” which would basically distill down the company’s ownership altogether.
Devin Nunes, the company’s CEO, noted “Since Trump Media now has approximately $3 billion on its balance sheet, we have the flexibility to take actions like this which support strong shareholder returns, as we continue exploring further strategic opportunities.” This buyback would be separate from the planned cryptocurrency buy, which Nunes also referred to as a “crown jewel” of Truth Social going forward.
Keep Selling the Oil
The company’s largest shareholder, President Donald Trump, also came out with a noteworthy point to anyone selling oil: keep selling it. And keep selling it at current prices, because failing to do so would be “…playing into the hands of the enemy.” Who the “enemy” was—or even who Trump was addressing beyond the “everyone” he mentioned in a Truth Social post—was unclear at best.
Trump also turned to a familiar call: “DRILL, BABY, DRILL!!! And I mean NOW!!!” Trump has long called for domestic energy production, so this return to form is not at all out of line for him. But so far, the oil market has remained comparatively blasé about recent events, with crude oil dropping $0.75 per barrel following Trump’s posts.
Is Truth Social Stock a Good Buy Right Now?
Turning to Wall Street, no analysts currently hold a rating on DJT stock. So we turn to the last five days of trading instead. As it turns out, DJT stock is down 4.13% for the period. The stock had been in a mostly downward slope until the buyback was announced. But the rally that followed was largely lost, and shares remained comparatively down.
