Please note that this content should not be considered investment advice. The author holds no investments in any of the companies mentioned.
Trump’s Media Holdings Transferred to Trust
The recent transfer of Donald Trump’s significant stake in the Trump Media and Technology Group (TMTG) to a revocable trust, with Donald Trump Jr. appointed as the exclusive trustee, may indicate a shift in Trump’s plans regarding his media holdings during his upcoming term as president. This move eases concerns among investors who see value in Trump’s association with the company, at least for the immediate future.
Ownership Details
As it stands, Trump maintained a considerable 59% stake in TMTG, equating to approximately 114.75 million shares. The transfer, detailed in a recent SEC filing, signifies a shift in direct ownership:
“The reporting person transferred 114,750,000 shares of common stock of Trump Media & Technology Group Corp. on December 17, 2024 as a bona fide gift to Donald J. Trump Revocable Trust Dated April 7, 2014 (the ‘Trust’) for no consideration. Following the transaction, the reporting person directly owned 0 shares of Trump Media & Technology Group Corp. and indirectly owned 114,750,000 shares of Trump Media & Technology Group Corp.”
Implications for Investors
Trump’s consistent involvement with TMTG is particularly vital for investor confidence. The company’s valuation is predominantly tethered to Trump’s influence, especially given its struggle with revenue generation. During the third quarter of 2024, TMTG reported meager earnings of just $1 million, alongside interest income of $4.7 million. The financial picture is further complicated by a net loss of $19.2 million, largely driven by legal costs related to the company’s acquisition of TV streaming technology.
Financial Performance Under Scrutiny
The company faced criticism from outlets like the Washington Post, highlighting that TMTG recorded only $2.6 million in revenue over the first nine months of the year and incurred a staggering cash burn of $363 million. Comparatively, Trump’s social media platform, Truth Social, lags significantly behind its competitors, boasting only 8 million followers versus 95 million on Elon Musk’s X (formerly Twitter).
In the wake of his election victory, Trump dismissed speculations surrounding a potential sale or reduction of his media holdings as “fake, untrue, and probably illegal,”reinforcing his commitment to TMTG as he prepares for his new term. This pledge may stabilize TMTG’s stock performance through an uncertain market environment.
For ongoing updates and more insights on Trump’s media ventures, check out the full article here.
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