Camber Energy Flirts With NYSE American Delisting

CEI Stock - Camber Energy Flirts With NYSE American Delisting

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It has been more than three weeks since the NYSE American Exchange sent Camber Energy (NYSEAMERICAN:CEI) a letter saying that it wasn’t compliant with the exchange’s continued listing standards. Fortunately for owners of CEI stock, the company was able to get an extension until May 20. While the share price took a hit after the news release appeared online, it has since recovered as investors look for bargains in the oil and gas sector, which has been on fire for the past 15 months. In 2021 alone, oil prices rose by 50%.   

However, if not for the lax listing standards of the NYSE American, Camber Energy’s stock would have already been delisted. So, if you’re thinking of buying CEI below $1, you might want to think again. Despite the lax standards, it could still be delisted in 2022. Here’s why. 

CEI Stock and the Low-Price Rule

Most of the NYSE American’s continued listing standards have no teeth. For example, you need a market capitalization (cap) of just $1 million to qualify for listing. Camber easily meets the low threshold with a $303.5 million market cap. 

There are some financial criteria companies must meet. Still, those are generally ignored if a firm has at least 1.1 million shares held by the public — Camber has 360.1 million outstanding, 93.7% of which are its float — and a $50 million market cap, which it does. 

Here’s where the low-price rule comes into play. Both the NYSE and Nasdaq have $1 closing bid requirements. Companies that close below a $1 minimum bid for 30 consecutive business days are sent a delinquency letter. After that, it has 180 days to regain compliance. Often, a company is given a second 180-day compliance opportunity. If that doesn’t work, delisting can occur. At the NYSE American, it considers a low price of 20 cents, one-fifth of the NYSE and Nasdaq. Currently trading at 86 cents, CEI stock is not in any danger of delisting based on price.

It Could Be for Late Filing

The letter sent by the NYSE American on Apr. 1 to extend the company’s time to comply with its listing standards is one of many sent by the exchange. Its first letter to Camber was on Jan. 6. The exchange requested that it file a 2020 10-K for the nine months ended Dec. 31, 2020, a 10-Q for March 31, 2021, a 10-Q for June 30, 2021, and a 10-Q for September 30, 2021.

Camber says it will meet these four filings, plus its 10-K for the period ended Dec. 31, 2021. However, we are 24 days from the deadline. This issue started in January and is still ongoing.

The last time I wrote about the company was in early November. At the time, I scoffed at one FinTwit personality who raised their target price for Camber to $10. I wrote:

“If you’re contemplating buying the oil and gas penny stock, don’t waste your money or time on this turd. Meme stock or not, it’s the modern-day equivalent of Florida swampland.”

At the time, it traded at $1.25. It is down 33% since. The red flags surrounding this company are extraordinary. It would not surprise me if Camber Energy were delisted in 2022. So, don’t waste your time on this stock. 

On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.

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