Trump Media & Technology Group Shares Plummet Amid Presidential Campaign

Declining Shares of Trump Media & Technology Group

Shares of Donald J. Trump’s social media enterprise, Trump Media & Technology Group, have experienced a significant decline, with the value of his once $6 billion stake now plummeting to approximately $2 billion. As of early trading on Wednesday, the stock was hovering around $17.40 per share, marking a dramatic drop of over 70 percent since its peak following the company’s merger in March with a publicly traded special purpose acquisition company (SPAC).

Mr. Trump stands as the largest shareholder in Trump Media, owning about 115 million shares, which translates to a substantial 60 percent stake in the company. The recent downturn in share prices has intensified in light of the escalating presidential campaign, particularly as the Democratic nominee, Vice President Kamala Harris, has recently edged ahead of Mr. Trump in several national polls. This fluctuation in stock value appears closely tied to investor sentiment regarding Mr. Trump’s performance in the race for the presidency.

A crucial factor contributing to the stock’s decline is the impending expiration of a contractual lockup period. This lockup has prevented Mr. Trump from liquidating any of his shares, but starting September 19, he and other early investors will have the opportunity to sell their holdings. This event could potentially exert additional downward pressure on the stock price of Trump Media.

Currently, Trump Media’s shares are trading at a level comparable to the initial $17.50 price of Digital World Acquisition Corporation, the shell company involved in the merger. In January, investors began acquiring shares of Digital World in anticipation of the merger’s successful completion. By the time the merger was finalized on March 25, shares of Digital World had surged to nearly $40, reaching a peak of over $66 just two days later.

Despite the recent drop, even at its current valuation, the stock’s price remains high considering that Trump Media is incurring tens of millions of dollars in losses each quarter, while Truth Social, the company’s flagship platform, is generating only minimal advertising revenue. Many of Trump Media’s investors are individual shareholders and ardent supporters of the former president, who initially purchased shares of Digital World when the merger plans were first announced in October 2021. Some investors entered the market when shares of Digital World were trading near $90, driven by the initial wave of enthusiasm surrounding the deal.