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Over the course of several months, shares of Trump Media & Technology Group have been declining. But the value of the company’s stock could plummet if its majority shareholder, former president and Republican nominee Donald Trump, loses the November presidential election.
“I would expect the stock to go to zero or something close to it, if he were to lose the election,” said John Rekenthaler, vice president of research at Morningstar MORN-0.97%. “This stock is predicated on Donald Trump winning the election.”
Trump Media, the company behind Trump’s right-wing social media site Truth Social, is what Rekenthaler calls an “affinity stock.” In other words, much of its market success has been dependent on the company’s connection to the former president.
“It’s purchasing his brand,” Rekenthaler said. “But he’s not going to have a brand if he loses a second straight presidential election.”
Trump holds 114.75 million shares in Trump Media, or about 60% of the company’s outstanding common stock. The six-month lockup period on his shares is set to end in late September, which would allow the former president to sell his stake in the company for a considerable profit.
Shares of Trump Media traded at $22.83 Friday morning, up 0.57% and bringing its market capitalization to $4.54 billion. In the immediate aftermath of the stock’s Nasdaq debut on March 26, Trump Media had a market value of roughly $8 billion — billions more than what it is worth today. Since then, the company’s share price has fallen nearly 61%.
Several polls currently show Vice President and Democratic presidential nominee Kamala Harris with a slight lead over Trump, both nationally and in a handful of key battleground states.
If the 78-year-old Republican candidate were to lose, he would be 82 years old by the time the next presidential election comes around, making him an unlikely candidate for the 2028 election cycle. (That said, President Joe Biden is 81, and only recently ended his own bid for reelection).
To be sure, Trump Media shares spiked following his debate performance against President Biden in June, and after last month’s assassination attempt at a campaign rally in Pennsylvania. The first debate between Harris and Trump is set to take place on Sept. 10 in Philadelphia.
But as the election cycle continues to heat up, particularly with the Democratic National Convention and Harris’ acceptance of the nomination Thursday, Trump Media stock has hit new post-merger lows.