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Why investors are doubling down on Truth Social despite Trump's historic conviction

Trump Media shareholder Justin Peedin says he plans to stand by Trump despite the former president's historic conviction.
Chris Delmas
Trump Media shareholder Justin Peedin says he plans to stand by Trump despite the former president's historic conviction.

When a New York jury convicted former President Trump, supporter Justin Peedin in Florida was outraged.

So he decided to take a stand: by buying more shares in Trump’s social media venture — while encouraging others to do the same.

“It’s almost time to show them what DJTArmy is all about!!!! Buy more today and hollllllld,” Peedin wrote in Truth Social a little before trading started on Friday.

Peedin is part of a legion of Trump supporters who own shares in Trump Media & Technology Group — the company behind Truth Social.

Many supporters have invested despite all the warnings from professional investors about a company that's losing money and has little revenue.

And now, at a time when many investors would normally flee because of the former president's conviction, Trump Media shareholders are vowing to double down over their anger about a conviction they view as a miscarriage of justice.

At least on Friday, their push to pump up the stock didn't pan out. After initially opening up about 15%, shares ended the day down 5%.

Trump Media shareholder Justin Peedin says he plans to stand by Trump despite the former president's historic conviction.
Courtesy of Justin Peedin /
Trump Media shareholder Justin Peedin says he plans to stand by Trump despite the former president's historic conviction.

But far from being discouraged, Trump Media shareholders are vowing to hang on.

It is the latest twist in what has been a volatile ride for Trump Media shares since making its stock market debut in March by merging with a listed shell company.

For those who invested early, it has been a remarkably lucrative ride so far. But nobody has benefited more than former President Trump.

And now, whether or not these shareholders decide to hang on will determine the fortunes of a company many in Wall Street have panned as a dud.

A lot of money at stake

Trump has a lot riding on Trump Media. He owns nearly two-thirds of the company.

Despite taking a hit on Friday, Trump’s stake was still valued at $5.6 billion — a windfall that earlier this year placed him in the Bloomberg Billionaires Index for the first time.

It’s an incredible value for a company that lost over $300 million in the first quarter and had almost negligible revenue. It also had just under 700,000 monthly active users in April, compared to over 76 million for X, according to data from Similarweb.

Trump’s newfound fortune is all thanks to hundreds of thousands of investors who have bought into Trump Media, many of them to show support for former President Trump.

Justin Peedin is one of them

Peedin became a Trump supporter in 2015. He was teaching English in an Arab village in Israel. He had left a sales gig in a call center in Maryland. He says he left partly to escape the racial strife in the U.S and partly to reconnect with his Jewish heritage.

“I figured if I can help make peace over there, you can make peace anywhere,” he says.

Peedin voted for Trump twice and he believes the world now needs Trump more than ever. It’s why he also decided to invest in Trump Media.

“Unfortunately, the world's not just hugs and kisses everywhere. There're people that really want to do harm. And we need strong leadership,” he says. “I'm scared for the future. So, 2024 is a big year. And that's why I'm invested in this, you know?”

Truth Social’s appeal

Peedin is a huge fan of Truth Social. It’s a platform where he and others have found relief from what they see as censorship in rivals such as X and Facebook.

And Peedin believes that if the former president returns to the White House in November, Truth Social would become an incredibly valuable company.

“I think he's got a good shot at winning again. And if he's only using this platform, I feel like the sky's the limit with it," Peedin says. "And I also believe in it, which is, like, very rare, to have an investment in something you believe in so much."

Donald Trump attends his criminal trial at Manhattan Criminal Court in New York City on May 29, 2024.
Doug Mills-Pool / Getty Images
Donald Trump attends his criminal trial at Manhattan Criminal Court in New York City on May 29, 2024.

That belief has gotten him a pretty handsome profit so far — at least on paper.

Peedin got in early, investing just over $50,000. He paid an average of around $35. With Trump Media now trading at $49, Peedin is sitting on a paper gain of around $20,000 — a sizeable return for a stock that media mogul Barry Diller recently referred to as a "scam."

Peedin says he bought a few more shares on Friday, a day after Trump’s conviction.

If he were to lose it all, Peedin says he can still put food on the table for his wife and his toddler.

"I'm not gambling my son's diaper money, you know?" he says.

Wall Street is not impressed

Not everybody has made money in Trump Media.

The stock has been incredibly volatile day to day. They are now slightly below the day before its debut, but they have delivered a nice return to those like Peedin who invested early.

Many professional investors have warned against the stock, which is trading at valuations well above what its financial performance should dictate — even though there are multiple risks facing Truth Social.

The company is trying to expand into online video and has said it plans to grow through mergers and acquisitions, both of which could turn out badly.

Most importantly, professional investors warn that the company’s fortunes are tied to former President Trump, who’s due to be sentenced in July after being convicted of the 34 felony counts.

Trump also still faces several other state and federal criminal cases, and the stock’s performance could be directly impacted by his electoral fortunes in what is expected to be a heated presidential campaign.

Trump's stake

There are even more risks looming. Trump could one day cash in and bail from the company — which could hurt shareholders like Peedin.

Trump can’t sell his shares yet. Under his current agreement, he has to hold on to them until September, right in the midst of the presidential campaign. But he could be given permission to sell even sooner by Trump Media’s board, which is full of friendly voices, like his son Donald Trump Jr.

Yet none of these risks faze Peedin.

He still believes Truth Social is a startup with immense potential even after Trump's conviction. He has an unwavering belief in the former commander in chief — and he believes Trump would not hurt supporters like him by cashing out of the company.

“I think he truly cares about the people that support him,” he says. “Because if you look at it, that would be kind of like stabbing everyone in the back. And I don't see him doing that.”

Copyright 2024 NPR

Rafael Nam
Rafael Nam is NPR's senior business editor.