Trump Media & Technology Group’s Stock Tumbles as Company Announces New Stock Offering

Trump Media & Technology Group’s Stock Tumbles as Company Announces New Share Offering

In a recent announcement, Trump Media & Technology Group (TMTG) revealed plans for a new stock offering that could potentially bring in a massive influx of shares. The struggling company, which has been rapidly losing money, is looking to the market for a lifeline.

However, the news of the additional 21.5 million shares for sale sent TMTG’s stock tumbling more than 18% on Monday afternoon. This latest development comes on the heels of the company’s merger with a blank-check acquisition company, which saw the stock surge before plummeting more than 60% from its peak.

The new stock offering is expected to devalue existing shareholders’ stakes, including that of former President Donald Trump, who has already seen his net worth take a hit since the company went public. Trump’s stake in TMTG was valued at $5.2 billion at its peak but has since dropped to about $2.3 billion.

Despite the steep declines, some experts believe that the stock’s downward trajectory may be temporary. Matthew Tuttle, CEO of Tuttle Capital Management, noted that while the move may upset shareholders, management would be “stupid” not to sell more stock to raise much-needed funds.

The company’s association with Trump, a polarizing figure, has also contributed to the stock’s volatile swings. Experts have cautioned retail investors to be cautious when trading TMTG’s stock, as the company lacks the fundamentals to support its high valuation.

In addition to the financial challenges, TMTG also faces risks related to Trump’s ongoing legal proceedings, which could negatively impact the company’s reputation and brand. The company warned potential investors that adverse outcomes in Trump’s legal battles could have a detrimental effect on TMTG’s business.

Despite the uncertainties surrounding TMTG, some investors may see an opportunity to “buy the dip” as long as Trump remains in the news. The company’s future remains uncertain as it grapples with financial woes and legal challenges, but for now, all eyes are on how the market will react to the latest developments.