Donald Trump, the former president, is not only focusing on his recent debate with Vice President Kamala Harris; he can also potentially begin selling shares of Truth Social’s parent company next week as a lockup provision expires. Shares of Trump Media declined by over 14% before the market opened on Wednesday, following the debate between Trump and Harris, and after singer Taylor Swift endorsed Harris for president.
The lockup provision prohibiting company insiders from selling newly issued shares usually lasts for six months. Trump can commence selling his nearly 115 million shares of Trump Media & Technology Group Corp. on Sept. 19, as per a recent filing with the Securities and Exchange Commission. At the closing price of $18.04 on Tuesday, Trump’s shares are valued at around $2 billion.
The decision on whether Trump will sell any of his shares remains uncertain. Despite the potential for a substantial payout, the stock’s value has significantly decreased compared to several months ago when Truth Social initially traded on the Nasdaq at a high of $79.38.
Operating the social media platform Truth Social, Trump Media was established after Trump faced bans from Twitter and Facebook following the Jan. 6, 2021, Capitol riot. The company, based in Sarasota, Florida, has been experiencing financial struggles, reporting a loss of nearly $58.2 million last year with only $4.1 million in revenue, as per regulatory filings.
Trump Media’s shares have been labeled a meme stock by some market professionals, indicating stocks influenced by online hype that surpass traditional valuations. Over the past few months, the stock has shown fluctuations, mainly influenced by individual investors who are often considered less experienced than day traders.
