It seems like former President Donald Trump's involvement with Truth Social is generating significant attention and speculation, especially regarding its financial aspects. Despite the platform's relatively small size and Trump Media & Technology Group's financial losses, Trump stands to gain a substantial number of shares, potentially valued at around $1.3 billion based on current prices.
However, the actual value of these shares is subject to market volatility and various legal restrictions, such as lock-up agreements preventing insiders from selling or borrowing against their stock immediately after the merger. Even if Trump were able to sell his shares, experts suggest that doing so could pose challenges due to the potential impact on the share price.
Additionally, there's criticism regarding the valuation of Trump Media, with some experts arguing that its share price is significantly inflated compared to fundamental metrics like price-to-sales ratio. This has led to warnings of potential overvaluation and predictions of a significant decline in the share price.
The market's response to certain events, like Trump Media's announcement of registering new shares, reflects what some experts perceive as irrational behavior driven by uninformed traders rather than market fundamentals.
In an unusual move, Trump Media provided guidance to shareholders on how to prevent their shares from being loaned to short sellers, indicating concerns about downward pressure on the stock price from short selling.
Overall, the situation surrounding Truth Social and Trump Media seems to be characterized by a mix of financial opportunity, speculation, criticism of valuation, and market volatility.
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