Trump Media Stock On Retail's Radar After Stock Slides 8% On Musk Feud And Dilution Worries

Retail sentiment toward Trump Media & Technology Group Corp. turned sharply negative on Thursday as investors digested two major concerns - a deepening political feud between Donald Trump and Elon Musk, and fears of shareholder dilution stemming from a multi-billion-dollar securities offering.

The stock closed down 8% at $20.12 on Thursday, though pre-market trading showed a modest rebound of 1.9% to $20.50.

The fallout began with Elon Musk's criticism of a proposed $1.6 trillion U.S. government spending bill, which he said undermined electric vehicle adoption by cutting EV incentives and favoring fossil fuels. 

Trump fired back by threatening to terminate federal contracts awarded to Musk's companies, including Tesla and SpaceX. 

The exchange quickly escalated on social media, with both figures launching personal attacks, memes, and jabs that sparked a wider debate among retail investors.

While the feud raised broader questions about potential political retaliation and regulatory risks facing Musk-led firms, it also cast a shadow over Trump Media's stock.

DJT, the parent company of Truth Social, filed a preliminary prospectus with the SEC for a public offering of up to $12 billion in various securities - a move seen by many as potentially dilutive for current shareholders.

Just days earlier, on May 30, the company disclosed that it had raised $1.44 billion via equity at $25.72 per share and an additional $1 billion in convertible senior notes. 

The proceeds are earmarked for establishing a Bitcoin treasury, marking an unusual strategic shift for a social media firm.

As a result of these financings, the Trump family's ownership stake in DJT dropped from 52% to 41.5%. 

Since DJT does not issue special voting shares, the reduced stake raises investor concerns over whether the Trump family can maintain effective control of the company.

On Stocktwits, retail sentiment was 'extremely bearish' amid 'high' message volume.

DJT is among the top 10 trending stocks on Stocktwits. 

The stock has declined 40.9% so far in 2025.

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