It’s Election Day in the U.S. and short sellers are closing in on Trump Media & Technology Group (DJT). Data from Fintel shows that short interest now accounts for 20% of DJT stock’s float, up from 18% five days ago. On that day, there were no shares of DJT available to short. Today there are 25,000 but the share count has been decreasing steadily falling from 60,000 a few hours ago. This shows that short sellers are increasing their bets that Trump will lose.
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What’s Happening with DJT Stock?
Since yesterday, DJT stock has been rising on pre-election momentum, with both Trump and Truth Social in full focus. However, DJT is still down 11% for the week. It began losing momentum after polls began to swing in favor of Vice President Kamala Harris.
Additionally, reports that Polymarket, a predictive market that had forecasted high odds for Trump, is rife with illegal wash trading haven’t been good for DJT either. Illegal wash trading, where traders buy and sell the same asset to create fake demand, suggests that public sentiment for him might not be as strong as it appears.
The high short interest in DJT stock indicates two things: that short sellers are not confident in a Trump victory and that they believe even if he wins, DJT stock lacks long-term growth potential. The stock rises and falls with Trump, primarily traded by retail investors who either view it as a meme stock or want to bet on Trump.
Many experts have expressed concerns about Trump Media’s finances. TipRanks reporter Ben Mahaney recently pointed out that, despite a current market cap of $10.3 billion, Trump Media has brought in only $3.4 million in revenue over the past 12 months and is still unprofitable.
Is is Time to Sell DJT Stock?
As no analysts follow DJT stock, it is hard to definitively determine its rating. However, given the company’s financial issues highlighted by Mahaney, it’s logical that short sellers would bet against it. If Trump wins, the stock might surge but would likely fall again, given Trump Media’s low revenue and weak sales record. If Harris wins, DJT stock will likely plunge and may never recover, as Trump’s political career would essentially be over.
Currently, DJT stock has a short squeeze score of 85.17 on Fintel, based on “a combination of short interest, float, and short borrow fee rates.” Within hours, poll results will start coming in, and if they aren’t in Trump’s favor, DJT stock will likely reverse course.
