People lose worth as Donald Trump stocks plunge

"Management would be stupid not to sell more stock," says expert

By
Web Desk
The stocks of TMTG (DJT) decline roughly 17% mid-day. — Reuters/File
The stocks of TMTG (DJT) decline roughly 17% mid-day. — Reuters/File

As former US president Donald Trump went to court to face a hush money trial, the share price of his company Trump Media & Technology Group (TMTG) stumbled again as the firm offered more stocks to keep the company afloat.

The company is offering 21.1 million more shares to investors Monday which could potentially devalue the current stakes held by the shareholders, including the 79 million shares of Donald Trump.

More shares in the market means, there will be additional sales of the stocks.

The stocks of TMTG (DJT) plunged roughly 17% mid-day Monday. 

In recent months, the prices were high after the reports of a merger with a blank cheque company however, the peak was seen only on March 26. Since then, the company lost over 60% of its worth.

Matthew Tuttle, who is the chief executive of Tuttle Capital Management, was quoted by CNN as saying: "The management would be stupid not to sell more stock, even though the move will upset shareholders."

"Whenever you see a stock jump, like you saw this jump, a secondary offering is always a risk," Tuttle said, adding, "I think a lot of investors in this don’t know that. … You’ve got a lot of probably Trump fans sitting there saying, what the heck?"

Tuttle said: "As long as Trump is in the news in some way, shape or form, this is going to be a meme stock. People are going to trade it."

Shares on March 27 were at the closing high of $66.22. Now it has caused investors to lose half of their money.

The decline in stock prices also caused the loss of about $400,000 to Trump on Monday.