Trump Media Hits New Low After Lock-Up Expires – Reuters

Shares of Donald Trump’s media company experienced a nearly 8% drop on Friday, marking a new low amid ongoing losses after the expiration of a lock-up period on insider sales.

Trump Media & Technology Group, in which the former U.S. President holds a 57% ownership stake, has seen its market capitalization fall to $2.7 billion following five consecutive days of declines. The company’s shares, which are associated with the Truth Social app, closed at $13.55—its lowest closing price since its market debut in March.

The expiration of restrictions on insider selling occurred on Thursday after the markets closed, allowing insiders to sell their shares freely. During Friday’s trading session, about $300 million worth of Trump Media shares were exchanged, representing the highest turnover for the stock in the past week.

Trump recently indicated that he does not plan to sell his shares, shifting attention to other significant stakeholders who might choose to sell. United Atlantic Ventures and Patrick Orlando, who were instrumental in the merger that created Trump Media, together hold around 11% of the company’s shares according to regulatory filings.

With only a fraction of Trump Media’s shares currently available for trading, any significant sell-off could further reduce the company’s stock price. An analyst noted that the anticipation of new selling could directly impact the stock price while also increasing the stock’s lending pool, potentially facilitating more short selling.

Additionally, Trump Media’s value surged to nearly $10 billion after its debut on Wall Street, buoyed by interest from Trump supporters and retail investors viewing it as a speculative investment linked to his political future. However, the stock has since experienced substantial declines, particularly following President Biden’s announcement of his decision to step back from seeking reelection on July 21.