Sally Reed
The Trump train appears to be running off the rails. DJT stock took a nosedive on Monday after the social media company filed paperwork allowing stockholders, including the former president himself, to cash out.
With shares plummeting nearly 20% amidst the sell-off, it seems insiders are racing to dump stock while they still can. Meanwhile, the company’s first criminal trial is set to kick off, marking yet another dent in the Trump empire’s armor.
Trump Media Stock Plummets as Insiders File to Sell
Trump Media and Technology Group Corp.’s stock price took a nosedive after the company filed paperwork announcing Trump and other early investors intended to sell their shares.
According to SEC filings, the former president and his associates could sell up to 146.1 million shares, valued at over $400 million at current prices.
Sellers Cash Out Just As Trial Starts
The mass sell-off comes as criminal proceedings begin in New York against Trump over hush money paid to Stormy Daniels. Between legal troubles and a failing media company, Trump’s post-presidency isn’t off to a great start.
For those still holding onto DJT shares and hoping for a rebound, the insiders dumping stock should serve as a warning.
Over 100 Million Shares Filed for Sale Despite Lockup Period
Trump Media’s stock price took a nosedive on Monday after the company filed an S-1 with the SEC announcing the potential sale of 114.75 million shares, many held by insiders.
Though locked into a holding period until September, early investors and Trump associates are looking to cash out.
Troubled Company and Waning Interest
Trump Media and its Truth Social platform have faced difficulties since launching earlier this year. The app rollout was buggy and slow, signups stalled, and executives departed.
Interest in Trump Media seems to be fading as well. Google Trends data shows searches for “Trump Media” and “Truth Social” have declined steadily since the hype around the launches.
Stock Price Falls to Lowest Point Since January
The stock price of Trump Media and Technology Group Corp. plummeted to its lowest point since January as insiders rushed to dump their shares.
On Monday, the company filed an S-1 with the SEC announcing the potential sale of up to 114.75 million shares by stockholders, including former President Donald Trump.
Investment Firms Also Seeking To Cashout
Investment firms with connections to Trump also aim to cash in. Hedge fund Saba Capital Management, founded by Trump donor Boaz Weinstein, wants to sell over 200,000 shares valued at more than $5 million.
EF Hutton LLC, an investment bank that handled the merger between Trump Media and Digital World Acquisition Corp., the SPAC that took Trump Media public, plans to sell nearly 87,000 shares worth $2.3 million.
Pam Bondi, Trump’s Former Florida AG, Stands to Gain Millions
Pam Bondi, a longtime Trump supporter and former Florida Attorney General, has filed to sell up to 106,250 of her shares, which are currently valued at around $2.9 million.
Bondi served as AG during Trump’s early years in Florida and was a vocal advocate for him during his campaigns and presidency.
CEO Devin Nunes Looks to Unload $3 Million in Stock
Devin Nunes, Trump Media’s CEO and another staunch Trump ally has filed to sell 115,000 shares worth an estimated $3.1 million.
The former Republican congressman from California has been one of Trump’s most vocal supporters, even receiving the Presidential Medal of Freedom from Trump in 2021.
Trump Also Looking To Cashout
President Trump himself looks poised to make a significant profit by selling his shares in the struggling company.
His filing indicates that he wants to sell up to 78.75 million shares worth an estimated $2.2 billion at current prices. The massive cashout would represent over 80% of Trump’s stake in the company.
Trump Silent on The Crushing Stock Prices
Trump has been notably silent about the stock sale filings and share price declines. He has yet to publicly comment on the insider selling spree or the sinking stock price.
The lack of statements from Trump suggests he may be more focused on profiting from his shares than turning the company around.
Company Not Receiving Any Proceeds From Insider Sales
The Trump Media and Technology Group will not receive any money from the sale of shares by insiders and early investors.
The S-1 filing with the SEC allows stockholders like Donald Trump, his associates, and Wall Street executives to sell up to 146.1 million shares they currently hold.
Trump Already Earned From The Merger
Trump was given 78.75 million common shares in the company when Digital World Acquisition merged with Trump Media in March.
However, Trump cannot sell any of his shares until September due to a lockup period. The stock price has plunged nearly 60% since reaching a high in March, right after the merger.
What Does This Mean For Truth Social’s Future?
The social network still faces an uncertain future. While it gained popularity among some conservatives, it has failed to attract a large mainstream audience.
The share sales also raise questions about Trump’s long-term commitment to the platform. However, the company says the sales won’t impact Truth Social’s day-to-day operations or its plans to launch an on-demand video service.
Is It Possible For The Share Price To Rebound?
It’s possible the stock could recover if Truth Social shows signs of success, but a rebound certainly isn’t guaranteed.
A lot will depend on whether Truth Social can expand beyond its core base and become a real competitor in the social media space. For now, investors seem to be taking a “wait and see” approach to the company’s shares.
GIPHY App Key not set. Please check settings