'Poised to go down': Trump Media's $7.2 billion tumble spurs dire warnings from analysts
Former President Donald Trump's publicly traded media company hit new stock market lows Monday as finance experts warned a recently reported financial could signal the beginning of the end.
Forbes Senior Editor Dan Alexander appeared on CNN's "Out Front" hours after news broke Trump Media would put more than 20 million shares up for sale because, as host Erin Burnett put it, "the company's bleeding money."
"It is a sad story," Alexander told Burnett. "And the trouble here is that if you look at the fundamentals of the company — it's poised to go down a lot more."
Trump Media stock came out of the gate strong on March 26 but went into free fall, dropping 21% last week and then 18.4% on Monday.
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The same day, Truth Social's parent company filed a request with the U.S. Securities and Exchange Commission that allows it to supply 21.5 million of shares that would add more than 15% more stock for the public to purchase, according to a CBS News report. The report estimates Trump Media has lost a total $7.2 billion in value.
In the filing, the company admits it's vulnerable to bankruptcy.
"A number of companies that were associated with President Donald J. Trump have filed for bankruptcy," reads one of the sections of the document. "There can be no assurances that TMTG will not also become bankrupt."
Says Alexander "this stock should fall by at least another 90% before the metrics start to make any amount of sense."
That's not only sad but bad news for those who gambled on Trump's stock, Alexander said.
"For people who are just blindly putting their faith in Trump and in the company — that means that they can stand to lose a lot of money," he added.
Alexander argues the company was set up primarily to benefit Trump and Wall Street insiders who came in at "very, very discounted rates.
"Meanwhile, the retail shareholders were putting up huge sums to buy in," Alexander said. "The ultimate effect is that they put in the cash and the other people walk away with the shares."