Trump Media is being 'absurdly' valued by investors, LinkedIn cofounder says
AP Photo/Steve Helber
- Trump Media's valuation is "absurdyly" high, according to LinkedIn's cofounder Reid Hoffman.
- The billionaire entrepreneur noted that Turth Social is tiny compared to other social media.
- TMTG made just $4 million in revenue last year, financial statements show.
Trump Media's stock price is "absurdly out of the realm of normal business," according to LinkedIn co-founder Reid Hoffman.
Speaking to CNN on Tuesday, Hoffman pointed to the lofty $6 billion valuation of Donald Trump's media company even as its stock has tumbled since it first started trading following its public offering via SPAC in March.
Trump Media is worth just a fraction of LinkedIn, which was bought out for $26 billion in 2016. Still, the company's valuation is questionable, Hoffman said. For reference, TMTG made just $4.1 million last year and lost $58 million, according to its financial statements.
"That is wildly high," Hoffman said of its market value. "Trump Media is probably more appropriately valued close to $40 million rather than several billion."
DJT shares jumped 20% on Monday, marking one of its best single-day gains since going public. They were up another 7% as the market headed toward the closing bell on Tuesday.
Investing experts have raised some red flags about the former president's social media site amid who are keeping an eye on the company's financial losses and low user figures. Earlier this year, the firm tried to pass the blame for its stock crash on two of its co-founders, claiming that the executives did "significant damage" to the business before its IPO.