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Trump Media plunges amid plan to issue more shares. It’s lost $7.2 billion of value since its peak.
After a short-lived honeymoon, former President Donald Trump’s media company is experiencing a rough reception on Wall Street. Trump Media & Technology Group — which trades under the ticker DJT, his initials — tumbled 18% in Monday afternoon trading, a drop that follows last week’s 21% plunge.
The sharp drop in value comes after Trump Media, whose primary asset is Truth Social, the social media platform, on Monday filed a document with the U.S. Securities and Exchange Commission that opens the door for the future potential sale of millions of shares. The document, called an S-1, relates to warrants held by investors that can be transformed into shares of stock, as well as shares held by company insiders.
The filing also includes all the shares held by the former president. Trump, however, remains under a “lockup” deal that largely restricts him from selling his shares for another roughly five months. His son, Donald Trump Jr., who is a director on the board, and CEO Devin Nunes, are also bound by the lockup.
The stock plunge has erased billions from Trump’s stake — at least on paper. The shares soared when they began trading on March 26, giving Trump’s 57% ownership position a value of $6.25 billion. But after DJT’s recent slump, that stake is worth $2.1 billion, representing a paper loss of $4.15 billion.
Overall, shareholders have lost $7.2 billion of value since the stock touched a high of $79.38 on March 26. The shares tumbled $6.01, or 18.4%, to $26.58 in Monday afternoon trading.
When companies issue additional shares, they take on the risk of their stock price coming under downward pressure. That’s due, in part, to simple laws of supply and demand — with more stock available, a company’s share price tends to fall unless there’s a commensurate increase in demand.
So far, the former president’s supporters comprise a significant part of the company’s investor base, with Trump Media CEO Nunes praising their support on Fox Business earlier this month. On Truth Social, some investors said they believed the stock would recover, while others said they were taking advantage of the stock’s plunge to buy more shares.
“Bought more today just like a lot of you,” one member of a Truth Social group dedicated to DJT shares wrote on Monday. “I believe time is our friend. Half a year until election. I can definitely hold until then at the minimum.”
Other supporters on Truth Social noted that the Monday filing doesn’t necessarily mean Trump plans to sell any of his 57% ownership stake in Trump Media.
“Trump has NOT signaled intentions to sell his shares,” wrote Chad Nedohin, a pastor and musician, on Truth Social on Monday. “There is no new unexpected issuance of new shares. The increase in total shares in the S-1 is for the warrants.”
S-1 filings are typically filed quickly after a SPAC deal closes, usually within 15 or 30 days, said Kristi Marvin, founder of SPACInsider.com, which specializes in SPAC deals.
Trump Media & Technology Group didn’t immediately return a request for comment.
200,000 new retail investors
Trump, who relies on Truth Social as his primary social media platform, has about 7 million followers on the app, where he frequently blasts his critics and promotes favorable polls. He’s also turned to Truth Social to rail about his criminal trial, which began Monday, over accusations of falsifying business records related to a “hush money” payment.
About 600,000 retail investors have bought shares in Trump Media & Technology group, with about 200,000 of them buying into the stock within the last few weeks, Nunes told Fox Business earlier this month. He called these small investors “the most amazing part about our company.”
Those investors have had a wild ride since the stock began trading as DJT on March 26. The shares soared on its first two days of trading, but have since shed more than two-thirds of their value.
Such swings have prompted comparisons with so-called “meme” stocks like GameStop, which typically attract individual investors based on social media buzz, rather than traditional metrics favored by investors, such as revenue and profit growth.
Last year, Trump Media lost $58 million on revenue of $4.1 million — about half the annual sales booked by a single Chick-fil-A location.
—With reporting by the Associated Press.
CBS News
Former Trump national security adviser says next couple months are “really critical” for Ukraine
Washington — Lt. Gen. H.R. McMaster, a former national security adviser to Donald Trump, said Sunday that the upcoming months will be “really critical” in determining the “next phase” of the war in Ukraine as the president-elect is expected to work to force a negotiated settlement when he enters office.
McMaster, a CBS News contributor, said on “Face the Nation with Margaret Brennan” that Russia and Ukraine are both incentivized to make “as many gains on the battlefield as they can before the new Trump administration comes in” as the two countries seek leverage in negotiations.
With an eye toward strengthening Ukraine’s standing before President-elect Donald Trump returns to office in the new year, the Biden administration agreed in recent days to provide anti-personnel land mines for use, while lifting restrictions on Ukraine’s use of U.S.-made longer range missiles to strike within Russian territory. The moves come as Ukraine marked more than 1,000 days since Russia’s invasion in February 2022.
Meanwhile, many of Trump’s key selection for top posts in his administration — Rep. Mike Waltz for national security adviser and Sens. Marco Rubio for secretary of state and JD Vance for Vice President — haven’t been supportive of providing continued assistance to Ukraine, or have advocated for a negotiated end to the war.
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McMaster said the dynamic is “a real problem” and delivers a “psychological blow to the Ukrainians.”
“Ukrainians are struggling to generate the manpower that they need and to sustain their defensive efforts, and it’s important that they get the weapons they need and the training that they need, but also they have to have the confidence that they can prevail,” he said. “And any sort of messages that we might reduce our aid are quite damaging to them from a moral perspective.”
McMaster said he’s hopeful that Trump’s picks, and the president-elect himself, will “begin to see the quite obvious connections between the war in Ukraine and this axis of aggressors that are doing everything they can to tear down the existing international order.” He cited the North Korean soldiers fighting on European soil in the first major war in Europe since World War II, the efforts China is taking to “sustain Russia’s war-making machine,” and the drones and missiles Iran has provided as part of the broader picture.
“So I think what’s happened is so many people have taken such a myopic view of Ukraine, and they’ve misunderstood Putin’s intentions and how consequential the war is to our interests across the world,” McMaster said.
On Trump’s selections for top national security and defense posts, McMaster stressed the importance of the Senate’s advice and consent role in making sure “the best people are in those positions.”
McMaster outlined that based on his experience, Trump listens to advice and learns from those around him. And he argued that the nominees for director of national intelligence and defense secretary should be asked key questions like how they will “reconcile peace through strength,” and what they think “motivates, drives and constrains” Russian President Vladimir Putin.
Trump has tapped former Rep. Tulsi Gabbard to be director of national intelligence, who has been criticized for her views on Russia and other U.S. adversaries. McMaster said Sunday that Gabbard has a “fundamental misunderstanding” about what motivates Putin.
More broadly, McMaster said he “can’t understand” the Republicans who “tend to parrot Vladimir Putin’s talking points,” saying “they’ve got to disabuse themselves of this strange affection for Vladimir Putin.”
Meanwhile, when asked about Trump’s recent selection of Sebastian Gorka as senior director for counterterrorism and deputy assistant to the president, McMaster said he doesn’t think Gorka is a good person to advise the president-elect on national security. But he noted that “the president, others who are working with him, will probably determine that pretty quickly.”
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Sen. Van Hollen says Biden is “not fully complying with American law” on Israeli arms shipments
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Rep.-elect Sarah McBride says “I didn’t run” for Congrees “to talk about what bathroom I use”
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Former Trump national security adviser says next couple months are “really critical” for Ukraine
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Sen. Van Hollen says Biden is “not fully complying with American law” on Israeli arms shipments
Former Trump national security adviser says next couple months are “really critical” for Ukraine
St. Paul partners with SPPS to expand college savings program