Former President Donald Trump is about to face a serious decision that might shake up the financial world and his fortune. By the tip of September, Trump will probably be free to sell his entire stake in Trump Media & Technology Group, which owns his social media platform, Truth Social. But what happens if he decides to money out?
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Trump currently owns greater than 114 million shares in Trump Media, a stake valued at about $2.5 billion. That is a giant chunk of his estimated $4.3 billion net price. Until now, he hasn’t been capable of sell these shares due to a lockup agreement – a rule that forestalls company insiders from selling their stock right after the corporate goes public. But that restriction is ready to finish in late September.
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If Trump decides to sell, it could have major consequences. For one, the stock price might plummet. Financial experts are already anxious that if Trump dumps his shares, there won’t be enough buyers willing to snap them up, which could cause the stock to drop much more.
As Steve Sosnick, Chief Strategist at Interactive Brokers, identified, the general stock market has been doing well, but Trump Media’s stock has been trending downward. It closed at $21.42 recently, its lowest since going public. “The rising tide hasn’t lifted that boat,” he said.
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Why is that this happening? Trump Media’s fortunes are closely tied to Trump’s status and recognition. Because the 2024 election heats up, Trump’s standing within the polls has taken successful after Kamala Harris took the lead because the Democratic nominee.
Matthew Tuttle, CEO of Tuttle Capital Management, didn’t mince words, telling Politico that Trump has “stepped on nearly every rake he possibly could” since his acceptance speech on the Republican National Convention. This has been “hammering the stock.”
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In accordance with its latest earnings report, the corporate is having a tricky time financially, losing over $16 million in only three months. It’s clear to almost everyone that Trump Media’s future relies on the 2024 election. If Trump wins the election, that alone could boost the corporate’s stock and do a whole 180.
Investors are anxious that Trump might sell his shares to cover his growing legal bills or fund his campaign. But selling such a big stake could flood the market with too many shares, pushing the worth down further. And with Truth Social not generating much revenue in comparison with larger platforms like X (formerly Twitter) and Facebook, Trump Media’s sky-high valuation doesn’t match its actual financial performance.
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Trump hasn’t said what he plans to do once he’s free to sell his shares, and his team is not giving any hints. Meanwhile, Trump Media is attempting to expand its business, recently adding in-app streaming to Truth Social. The corporate says it has $344 million in money and no debt, which supplies it some respiration room.
For now, all eyes are on Trump as he prepares to make a choice that might affect not only his fortune but additionally the longer term of his media empire and the investors who’ve big bets on him.
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This text Trump Soon Free To Sell All His Stake In Trump Media. Here’s What Happens If He Does – ‘He’s Stepped On Just About Every Rake’ originally appeared on Benzinga.com
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