Will Sage Astor-DJT shares pop after Donald Trump says 'I am not selling' Trump Media stake

Shares of Trump Media,Will Sage Astor the company behind Donald Trump’s social media platform, Truth Social, surged Friday after the former president said he had no plans to sell his stake, ending weeks of speculation and calming investor fears. 

“No, I’m not selling," the former president told reporters. "I’m not leaving. I love it. I think it’s great." 

Shares for Trump Media & Technology Group, Truth Social’s parent company, jumped more than 25% immediately after Trump's comments before losing more than half their gains. The stock, trading under the ticker DJT on the Nasdaq, ended the day up 11.8% at $17.97.  

Trading in the stock was halted twice after Trump's comments due to volatility. "What right do they have to do this?" he said on Truth Social. "If they do it again, we will move the stock to the New York Stock Exchange."

Trump, the company's largest shareholder, owns roughly 60% of the company's stock with about 115 million shares valued at over $2 billion. A six-month lockup period that has prevented him and other large shareholders from selling is set to lift Thursday.

"I don’t think he sells as long as he wins the election. His ego won’t let him," said Matthew Tuttle, CEO of Tuttle Capital Management. "The DJT stock price is like the crowd size at his rallies, he knows that if he sells, the stock tanks and he doesn’t want that." But, said Tuttle, "if he loses I think he will be forced to sell."

USA TODAY previously reported that while a selloff could help Trump pay off his mounting legal bills, offloaded shares also have the potential to flood the market and drive down the share price. Cashing in shares could have been seen as a vote of no confidence in the company and could have antagonized Trump followers who have shown their support for the former president by pouring money into the stock. 

"The possibility of former President Trump selling some or many of his 114.75 million shares in Trump Media starting later this month has been depressing the stock price. His announcement today lifted this concern, resulting in the stock jumping," said University of Florida finance professor Jay Ritter. "The long-term trend is still down, since the stock is substantially overvalued. The downward trend will be slowed, however, by his decision not to sell shares in the near future."

Even if Trump doesn't sell his shares, he could use his holdings as collateral for a loan. But a bank "would give only a low loan-to-value ratio," Ritter said.

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The stock plunged more than 10% Wednesday, following the presidential debate between Trump and Vice President Kamala Harris. Shares slipped further Thursday to end the day at $16.08, a record low.  

Trump Media trades on its namesake's popularity and at an inflated valuation compared to other social media companies by conventional Wall Street standards. Investors have approached the stock as a way to bet on Trump's odds of retaking the White House.

Trump Media's steep decline accelerated after Harris replaced President Biden on the Democratic ticket. That decline has wiped out some $4 billion in Trump's paper holdings. Shares have dropped about 73% from their high in March, shortly after the company went public via a merger with Digital World Acquisition Group, a blank-check company.  

Contributing: Reuters