Trump Media & Technology Group’s Stock Plunges 18.35% Amid Share Offering Announcement

DJT, or Trump Media & Technology Group, saw its stock plunge by 18.35% after filing to offer 21.5 million new shares. This announcement led to a nearly 20% decrease in DJT’s stock value on Monday.

Dilution Worries Loom as New Shares Hit Market

Investors are worried about the dilution of their investments due to the introduction of more stock. Concerns intensify as a six-month lockup period concludes, potentially flooding the market with additional shares. This anticipation grows, especially as stakeholders in DWAC, the SPAC merging with Trump Media, gain eligibility to sell.

Investment Firms Eyeing Sell-Off

According to a Securities and Exchange Commission (SEC) filing on Monday, several investment firms, including Saba Capital, are gearing up to sell DJT shares. Saba Capital, led by managing partner Boaz Weinstein, held significant shares in DWAC before the merger in October 2021.

However, sources close to the matter reveal that Saba’s DJT stake primarily comprises restricted shares, initially mandated as part of the DWAC investment. Weinstein had previously indicated Saba’s complete liquidation of unrestricted DWAC shares upon the Trump Media deal announcement.

Anchor Investors and Individual Stakeholders Also in Play

Entities listed as original DWAC anchor investors, along with individual investors including past and present executives, are also enumerated in the SEC filing. Notable figures include former Florida attorney general Pamela Bondi, now with lobbying firm Ballard Partners.

Inclusion of DWAC investors like Pamela Bondi underscores scrutiny on Trump Media’s financial stability, WSJ Print Subscription said.

TMTG’s Stock Performance and Financial Health

Despite the high cost to short, DJT shares have plummeted nearly 30% since the merger approval on March 22. Weak fundamentals, such as a reported $60 million net loss last year on sales of just over $4 million, keep investor confidence shaky

Closing Thoughts

The revelation of potential sell-offs by other DJT investors adds to the woes of recent investors who have witnessed a continuous decline in the stock. With the company’s weak financials and ongoing share dilution concerns, the road ahead for Trump Media & Technology Group appears uncertain.

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