Shares of Trump Media & Technology Group have nosedived by over 74% from their March zenith, marking a dramatic downturn that has slashed the former president’s $6 billion stake to a mere $2 billion.
The stock closed at $16.98 on Wednesday, a stark contrast to the heights it reached following Trump Media’s merger with Digital World Acquisition Corporation (DWAC) in March. This plunge reflects a broader trend of the company’s valuation swinging in direct correlation with investor sentiment regarding Donald Trump’s political fortunes.
As Trump’s presidential campaign intensifies, his stock has taken a severe hit, especially as Vice President Kamala Harris has recently edged past him in national polls. This shift highlights the volatile link between Trump’s political standing and Trump Media’s stock performance.
Adding to the uncertainty, a crucial lockup period is set to end on September 19, allowing Trump and other early investors to sell their shares. This impending release could flood the market with additional stock and exacerbate the decline in Trump Media’s already battered share price.
Currently, Trump Media’s shares are trading below the $17.50 mark that DWAC had before the merger. Following the merger’s completion, DWAC shares soared to nearly $40 and peaked above $66 just days later. Despite this, Trump Media remains vastly overvalued given its ongoing financial struggles—losing tens of millions each quarter and grappling with paltry ad revenues for Truth Social.
The development comes just days before a key event in the presidential race, with the former president facing off against his Democratic rival in a crucial debate.
The majority of Trump Media’s investors are individual backers and ardent Trump supporters who initially bought into DWAC when shares were nearing $90 in a frenzy of optimism. Now, these investors face a harsh reality as the stock’s value plummets, exposing them to significant financial risk.
