Former U.S. President Donald Trump is set to receive a $1.2 billion earnout bonus in the form of 36 million shares in his newly public company, Trump Media & Technology Group. In order to qualify for the bonus, the stock needs to trade at or above $17.50 per share for 20 trading days within a 30-day period. Trump currently owns 57% of the company, with 78 million shares. The stock, trading under Trump’s initials DJT, has met the requirements for the bonus, with its 20th trading day passing without falling below $17.50. At the current closing price of $32.56, the earnout is valued at $1.2 billion. However, Trump and other executives are restricted from selling their shares for about five months to prevent stock destabilization.
With the additional 36 million shares, Trump will own approximately 115 million shares of DJT, worth $3.7 billion on paper. Despite this windfall, Trump is facing financial pressures due to legal judgments and ongoing legal expenses. Trump Media’s main asset is the Truth Social social media platform, and its stock has experienced significant volatility since its public debut. After surging to $79.38 per share on the first trading day, the stock has declined to about half of its peak value. Many of Trump Media’s shareholders are individual investors and supporters of Trump, with approximately 600,000 retail investors holding shares in the company. There is no institutional or Wall Street backing of Trump Media, and CEO Devin Nunes has praised the support of individual shareholders as the company’s strength.
Trump Media has advised shareholders on how to protect their shares from short selling, a practice where investors bet that a stock will fall. While short selling is legal, the company wants to help long-term shareholders who believe in the company’s future. This includes opting out of securities lending programs and ensuring shares are not held in margin accounts. Trump Media’s base of Trump fans and the stock’s volatility have drawn comparisons to “meme” stocks like GameStop, which attract individual investors based on social media hype rather than traditional financial metrics. The company’s stock market performance has been closely watched, especially with the involvement of Trump and his supporters.
The earnout bonus and increased share ownership position Trump to benefit significantly from Trump Media’s performance in the stock market. Trump Media’s value is tied to the success of the Truth Social platform, which aims to provide an alternative to mainstream social media platforms. The company’s reliance on individual shareholders rather than institutional investors has fueled speculation and interest in the stock. Trump’s financial situation, which has been complicated by legal issues, could be bolstered by the success of Trump Media. The attention on Trump Media’s stock and its unique investor base highlight the intersection of politics, business, and social media in the current landscape. The company’s future performance and Trump’s involvement will continue to attract scrutiny and speculation in the coming months.
