The company, which also includes an airline business, is on course to be relegated to the FTSE small cap index following the quarterly review of market constituents due on Wednesday evening.
Its value, which fell 30% after a fresh profit warning last week and revelations of a £163m annual loss, is down by more than 80% in the year to date and 60% over the past week alone.
That has taken its market capitalisation below that of its £389m in net debt.
Shares were as much as 15% lower on Tuesday in volatile trading amid continued investor jitters over its financial position. They closed the day almost 4% lower.
IHS Markit data showed that the cost of insuring Thomas Cook debt against default had soared this week despite the company's insistence its future was far from threatened.
Its five-year credit default swap, reflecting the cost of protecting against a default on its debt, jumped 73 basis points from Monday's close to 1,071 basis points, IHS Markit data reported by Reuters showed.
One trader told the news agency that the price equated to a 60% implied probability of default.
Another factor behind its share price collapse has been Brexit uncertainty facing the wider travel sector.
Bernstein analyst Richard Clarke said: "If you think that Brexit gets more dangerous, then you're not going to be wanting to buy into Thomas Cook at this stage because the fear will be that they're going to have to do a capital raise."
Airline values have also taken a hit from oil price rises and worries over further possible airline collapses after those of Air Berlin and Monarch last year.
Thomas Cook, which employs 21,000 people, said last week its lenders remained supportive and it had secured additional flexibility earlier this year to handle its debt position.
It had no further comment to make on Tuesday when contacted by Sky News.
Its position is that it is business as usual as it battles back from a tough summer that saw bookings hit by the UK heatwave.
The firm's plans to grow profitability include cutting capacity next summer to leave less space facing the prospect of discount.
Neil Wilson, chief market analyst at Markets.com, said there was a "triumvirate of nasties" for Thomas Cook investors to ponder.
He added: "I do think the heatwave has proved a bit of a killer and really whacked the UK business.
"But also there is something of a structural shift away from tour operators - easier than ever to sort your own trip these days. Airbnb etc.
"Two profits warnings in succession is always a bad sign - one rarely comes alone but clearly these have rattled investors more than was apparent first time around.
"Debt is the concern, with some raising questions about potential breach of covenants.
"That is why the shares have fallen so hard I think, although we do see incredible moves on profits warnings these days that I think you didn't see a few years back," he concluded.