Trump’s cratering Truth Social stock now trading at a near all-time low

13 August 2024

The stock for Trump Media & Technology Group (TMTG) — the parent entity of his Truth Social platform — has still not rebounded from its downward spiral since President Joe Biden exited the 2024 race and endorsed Vice President Kamala Harris.

In fact, in the three weeks since Harris became the presumptive 2024 Democratic presidential nominee, TMTG is now trading at just $24.35 a share as of Tuesday afternoon according to Yahoo Finance. That's almost as low as the $22.84 share price the stock posted in mid-April. That all-time low notably came amid reports that "short sellers," or investors who bet on a stock to fail, had zeroed in on TMTG (trading as $DJT on the Nasdaq Composite) as their #1 favorite stock to short.

TMTG's poor performance on Tuesday also comes after Trump sat down for a lengthy back-and-forth with X (formerly Twitter) owner Elon Musk on Monday night, and after he recently started posting again on the platform whereas Truth Social was previously the only place the ex-president had an active social media presence.

As Truth Social's value continues to decline, so does the former president's net worth. After his 34 felony convictions in late May, his net worth – which is pegged to his 66% ownership of TMTG — plunged by roughly $2 billion over the following weeks. And in the 10 days following Harris' rise, he lost another $800 million in personal wealth between July 21 (when Biden dropped out and endorsed Harris) and August 1.

The 45th president of the United States is so far forbidden from offloading any of his roughly 78 million shares in his company until September, as the initial public offering (IPO) agreement he signed in March prevented him from liquidating any of his shares for at least six months. However, if the value of $DJT continues to dip between now and September, he may be stuck with the stock until the election. Should he win, the stock's value would likely recover. But a loss would almost certainly render Truth Social's stock to be effectively worthless.

Billionaire investor Barry Diller, who is chairman of the Expedia Group, said as much in an April interview with CNBC. He likened TMTG to a "meme stock" (the term used for penny stocks that rookie investors buy on a lark in hopes of making a quick buck from social media traction) and said $DJT was for "dopes."

"I mean, it's ridiculous. The company has no revenue," Diller said. "It’s a scam, just like everything [Trump]’s ever been involved in is some sort of con."

Truth Social's financials seem to back up Diller's assessment. In 2023 statements the company submitted to the Securities and Exchange Commission ahead of its IPO, TMTG showed revenue of $4.1 million and a staggering $58 million in losses.

After initially launching with an IPO in excess of $62 per share in late March, $DJT has yet to bounce back to its original high. And after the former president's stake in the company lost $4 billion in its first week of trading, he sued his business partners for allegedly botching the IPO.

Trump's lawsuit accused co-owners Andy Litinsky and Wes Moss of improperly setting up the company's governance structure and failing in their oversight of the company's merger with the special purpose acquisition company (SPAC) — Digital World Acquisition — which preempted the IPO.

The ex-president's suit came after Litinsky and Moss sued him in Delaware Chancery Court for allegedly attempting to devalue their shares. That suit accused Trump of an "11th hour, pre-merger corporate maneuvering" scheme to create millions of new shares for the company, which would drastically reduce the value of their stake in the company. Litigation is ongoing in both suits.

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