Why is Trump’s social media stock plunging? DJT share price continues downward slide
Trump Media stock took another steep dive the day after the former president faced off in a debate with his 2024 opponent, Vice President Kamala Harris.
The share price of Trump Media hit a new low early on Wednesday since it began publicly trading in March of $15.30. The parent company of Truth Social saw a precipitous drop after its majority shareholder, former President Donald Trump, faced off with Vice President Kamala Harris in their first debate of the 2024 presidential campaign.
This was the latest in a series of new lows for the beleaguered DJT stock which has lost roughly 80% from its peak of $79.38 per share on March 26, following Trump Media’s merger with publicly traded special purpose acquisition company, World Acquisition Corp. (DWAC).
Why is Trump’s social media stock plunging? DJT share price continues downward slide
Trump Media stock, while it can be subject to swings in the market, typically sees its value rise and fall with the political fortunes of Trump himself in his bid to retake the White House. The last high the Trump Media stock experienced was after an assassination attempt on the Republican presidential candidate. However, since then, it has seen a near continues slide as the race has been upended with the last-minute switch of Democratic candidates from President Joe Biden to Harris.
But there are other factors at play in the stocks weakening position.
The financials behind the company are lackluster to say the least leading to analysts comparing it to meme stocks such as GameStop and AMC. In the company’s latest earnings report to investors in August it reported a net loss of $16.4 million in the second quarter of 2024.
This only increased doubts that the firm can turn a profit after reporting in May a net loss of $327.6 million in the first quarter of the year.
Additionally, in a matter of weeks company executives and Trump will be able to cash in their shares once the “lockup agreement” expires on 25 September, but could come as early as September 20 if the price stays above $12. Despite, saying that he does not intend to sell his holdings in Trump Media, nearly 59% of the company’s shares, there is speculation that he just might.
That’s because he is facing serious financial liabilities from numerous lawsuits and criminal legal cases which may prompt Trump to take the payday. Should that happen, it could cause an even bigger rout of the company’s stock.