Trump Media Tumbles to Record Level Even as New Polls Give Former President’s Campaign a Boost

Shares of the former president’s social media group hit new all-time lows on Monday, even as the latest polls suggest he is gaining ground in several key battleground states in the nation’s sunbelt.

Until recently, parent company Truth Social’s price was widely seen as a barometer of its chances in November.

On Monday, a survey published by The New York Times and Siena College showed him retaining his lead in Georgia while pulling ahead of Harris in Arizona and North Carolina after their contentious debate this month, which saw Trump go viral for claiming that immigrants eat livestock company.

It also marked the sixth straight day of heavy selling in Trump Media and Technology Group (TMTG), the parent of Twitter clone Truth Social, after a brief respite when Trump told reporters he had no intention of selling his nearly 115 million shares. .

It closed up 10% on the session to finish at $12.15, a low since first announcing plans three years ago to go public in a reverse merger with a blank check investment vehicle known as SPACE.

That’s the value of Trump’s 59% stake in the company, which was until this week subject to a six-month lock-up period after the SPAC merger, has fallen to just $1.4 billion the peak in March exceeded $9 billion.

Assuming Trump doesn’t sell his stake as he claims, the selling pressure won’t necessarily ease either.

Hello everyone! I have something incredible to share today as we present the launch of our Official Trump Coins! The ONLY OFFICIAL coin designed by me – and proudly minted here in the USA. The President Donald J. Trump First Edition Silver Medallion will be available… pic.twitter.com/9SP1PaLOTh

— Donald J. Trump (@realDonaldTrump) September 21, 2024

Billion dollar valuation, million dollar sales

With its meme stock image and refusal to reveal anything about the core values ​​that drive its business, the stock is shunned by financial analysts.

There is no estimate on Yahoo Finance for this year’s revenue, let alone earnings or, in TMTG’s case, losses.

Applying the same price-to-sales multiple of 7.5 times next year’s earnings that Reddit currently trades at to TMTG stock would give it a market cap of about $25 million.

That’s a fraction of the $2.4 billion that TMTG, on the way to annual sales of well under $4 million (with an “m”), is currently worth.

Excluding the $344 million raised from the SPAC deal — cash for which investors typically don’t assign a multiple above their stated value — the total assets on its books that can generate returns for shareholders amounted to just $12.5 million at the end of June. .

wealth TMTG officials could not be reached for comment. When contacted via TMTG’s Truth Social, Trump did not respond to a request for a statement.

“Directional bet on its brand value”

Given Trump’s need to raise cash to meet hundreds of millions of dollars in legal fines and a lack of unencumbered assets he can easily liquidate, investors don’t seem to be taking the former White House resident’s words at face value.

Last week, he announced his latest marketing plan: to sell one-ounce silver coins embossed with his face for $100 each — more than three times their current intrinsic value.

Chamath Palihapitiya, an early Facebook investor best known for promoting SPACs during their pandemic-era boom, wryly predicted that TMTG is “a directional bet on its brand value” and something like the official currency Trump just revealed.

Speaking on the All-In podcast shortly after TMTG began trading in March, he said the stock is “effectively a trading currency, a baseball card, if you will — a trading card through of an action’ which is based on the recognition and similarity of the former president’s name. .

Trump may have inadvertently hurt his own investment story by declaring Sunday that he would not run for president again if he lost in November. By removing him from any future races, he stands to lose his modeling influence the republican party.

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