Explaining DJT stock surge in the context of efficient markets

Trump Media (DJT) stock keeps going up, now at $53 as predicted here and here. When I claim to be to best investor and forecaster, it’s not bluster but backed by quantifiable evidence and results. So many people said it would go bankrupt or go to zero, yet when sone of the smartest people says it will not, whose advice is more likely to be right? Even when outnumbered, the smarter person tends to right on net.

However, its financials are pretty bad:

Losses in 2023 for Trump Media & Technology Group — whose flagship product is Truth Social — mark a stark decline compared with the profit of $50.5 million that the former president’s company reported for 2022, according to a company filing with securities regulators.

Revenue for Trump Media came in at $4.1 million in 2023, the SEC filing shows, although that’s up from $1.5 million in 2022.

$4 million revenue for 2023 and losses of $50 million. In the context of efficient markets, it’s hard to think of a justification for the stock having done so well. Matt Levine blames short selling and usurious borrow costs incurred on short-sellers, but this does not explain it either. There are way more examples of heavily-shorted stocks simply going to zero despite equally high borrowing costs and the occasional short-squeeze. DJT seems to be an exception in that it keeps going up no matter what. This suggests some other factor at play that may not be obvious.

The strong performance is DJT can be explained by how Trump is able to earn free advertising through his brand and the incessant media coverage he attracts. To get an idea of how valuable this is, Mike Bloomberg spent $500 million in six months on advertising in his doomed 2020 presidential campaign, so there is a way to put a price tag on this, which is a lot. I estimate Trump gets $1 billion annually worth of free media coverage. So hypothetically if Trump Media was to launch a new product or enter into some sort of merger or deal, advertising costs, which are a big expense, would be covered. This is why Tesla has much higher profit margins compared to its competitors, by not having to advertise.