FRGT

Freight Technologies ($FRGT) CFO Buys Shares Amid 96% Stock Collapse - Confidence Signal or Desperate Move?

06/10/2025 21:46

Donald Quinby, CFO of freight management software company Freight Technologies ($FRGT), purchased 4,000 shares at $2.60 per share on June 5, investing a total of $10,400, according to SEC filings. This insider purchase draws significant attention as it comes amid the company's stock plummeting over 96% in the past year. Houston-based Freight Technologies specializes in B2B freight management software solutions focused on cross-border freight between the U.S. and Mexico, as well as ocean logistics. The company operates various platforms including Fr8App (cross-border trucking), Fr8Now (LTL shipping), Waavely (ocean freight booking), and Fleet Rocket (transportation management system), leveraging AI and machine learning for supply chain optimization. Classified as a small-cap company, it employs approximately 82 full-time staff. CFO Quinby's purchase is particularly noteworthy given the company's severe financial distress. For 2024, Freight Technologies reported a net loss of $4.95 million against revenues of $13.54 million, with cash holdings of only $416,480, raising liquidity concerns. Most concerning is the negative stockholders' equity of -$655,000, signaling potential solvency issues. The stock's trajectory illustrates the severity of the situation. From around $70 in June 2024, shares have continuously declined to the current $2.46, representing a devastating 96.5% drop. Market capitalization has shrunk to approximately $5.28 million, pushing the stock into penny stock territory. Despite these challenges, the company is attempting an aggressive business transformation. Most controversially, in April and May, management announced securing up to $20 million to purchase Trump Tokens ($TRUMP), marking a radical shift from traditional logistics technology into digital asset investment. The company also executed a 1-for-4 reverse stock split in May to reduce share count and boost per-share price. Financial projections offer some optimism. Management forecasts 2025 revenue of $20-25 million, representing 45-80% growth over 2024. The Fr8Fleet segment showed strong performance with 42% year-over-year growth, while gross margins improved from 7.9% in 2023 to 9.8% in 2024, indicating operational efficiency gains. Technological innovation continues with the July 2024 launch of Waavely ocean freight platform and February 2025 introduction of Fleet Rocket TMS with AI tendering capabilities. The company also achieved ISO 9001:2015 quality management certification to enhance customer confidence. Quinby brings over 20 years of financial industry experience, having served as CFO at multiple public companies. His purchase, while modest at $10,400, signals confidence in the company's long-term recovery prospects rather than short-term price support. Macroeconomic factors present mixed signals for the freight technology sector. While U.S.-China trade tensions create supply chain disruptions, cross-border logistics demand continues growing. The Inland Container Depot and Dry Port market's 5.4% CAGR growth benefits Freight Technologies' core business areas. However, significant risks remain. Current cash reserves relative to monthly operating losses suggest potential liquidity crisis within six months without additional funding. The Trump Token investment strategy may also dilute focus from core logistics operations. Analysts view the current price level as offering more upside potential than downside risk, though fundamental business structure improvements and profitability recovery remain essential. While the CFO's insider purchase may provide short-term price stabilization, sustainable recovery requires addressing core operational and financial challenges.

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