Donald Trump’s reelection chances are declining, reflecting on TMTG’s stock price.
Shares of Trump Media & Technology Group (TMTG) plunged to a new low on Thursday after former president Donald Trump debated Vice-President Kamala Harris on ABC News. Polls show the vast majority of the public believes Harris won the debate, with Trump announcing he would not attend another one in this election season.
TMTG is the parent company of Truth Social, Trump’s flagship social network that he uses as a political platform. Until he rejoined X (formerly known as Twitter) last month, Truth was the only social network actively used by Donald Trump.
Trump owns 57% of TMTG shares, but he’s not allowed to sell them until a six-month lock-up period is over. A lock-up period is a standard procedure for newly listed companies, a measure to protect the company from speculative measures by major shareholders.
The Trump Media & Technology Group went public in late March, meaning the earliest Trump could sell his stake would be September 25th.
His entire stake in TMTG is valued at roughly $1.5 billion, putting Trump’s total net worth at $3.8 billion according to Forbes.
However, even after the lock-up period is over, it’s highly unlikely Trump will manage to reap the fruits of his social network.
Highly-political stock
Shares of TMTG started trading at $58 each, immediately jumping to $79 after the IPO filing, bringing the total value of the company to over $8 billion.
Analysts, however, noted the company had no revenue or profit capable of backing this evaluation. The IPO filing showed Q1 revenues of $770,500 against a net loss of $327.6 million. Although CEO Devin Nunes tried to reassure TMTG had enough cash in the bank, it wasn’t clear how the company could manage to finance its debt.
Indeed, the company’s stock price started declining almost immediately, dropping steadily to $23 in mid-April. Then, the stock price pretty much followed the trend of Trump’s presidential campaign: it rose after his debate with Joe Biden and the assassination attempt, it fell after Biden dropped out and Harris went ahead in polls.
Now, TMTG stock price reached a new low of $16. Trump is not allowed to sell his stake if the stock price falls below $12.
Kamala Harris is still ahead in polls, even in crucial swing states like Wisconsin and Michigan. Although the race is still too close to call, Trump appears to have far fewer chances than a few months ago. And that reflects on the performance of his stock.
