Mullen Automotive (NASDAQ:MULN) stock is down 5% today after the electric vehicle startup failed to reveal the name of the Fortune 500 company it is reportedly working with.
Investors are selling shares of MULN stock after the Brea, California-based company missed a deadline to provide details on the Fortune 500 order. Mullen CEO David Michery had earlier promised that the company would reveal “everything” about a Fortune 500 company it is working with by the end of the second quarter, which is today. Failure to disclose any information so far has clearly disappointed Mullen Automotive shareholders.
So far this year, MULN stock has dropped 80% to now trade at $1.08 per share.
What Happened With MULN Stock
Social media was abuzz after Michery gave an interview to Benzinga on June 3. During that interview, he promised Mullen would release a press statement by June 30 that would disclose details of an electric delivery van being purchased by a Fortune 500 company as part of a pilot program. While Michery evaded providing many details of the deal, he mentioned that Mullen had made an EV delivery on May 12 of this year to the Fortune 500 company he referenced.
Michery went on to say that the Fortune 500 company had put Mullen’s electric van into a “pilot program” and was “pleased” with its performance. Michery then said that “everything,” including details of the order size and delivery timelines, as well as the name of the company, would be announced by the end of the current second quarter, which is today. However, in a press statement released this morning, Mullen did not provide any further details. It did say that its balance sheet at the end of Q2 was the strongest in its history.
Why It Matters
Failure to provide any new details of the deal appears to have given MULN shareholders another reason to sell the company’s stock. Mullen remains a small startup that is unprofitable and spending money at a rapid clip. These facts help to explain the big decline in the stock price this year as investors dump shares of high-growth, unprofitable companies.
That said, Mullen Automotive has been making strides to improve its operations. The company has hired John Taylor to be its senior vice president of global manufacturing and strategic planning. Taylor is a veteran of the automotive industry and was one of the first 50 employees hired at Tesla (NASDAQ:TSLA). The company has also broken ground on its on its battery plant and begun building electric vehicle battery packs.
What’s Next for Mullen
MULN stock falls today after the company failed to announce any news related to orders for its electric vehicles or a strategic partnership with a major company. Already skeptic investors and shareholders appear to be taking the lack of any news negatively and as a reason to sell the stock.
Until Mullen Automotive demonstrates that it is receiving orders for its electric vehicles, its shares are likely to continue facing pressure.
Additionally, while the first press release today did not provide the name of the Fortune 500 company, investors are sure to be waiting until the end of the day to see if there will be an additional release.
On the date of publication, Joel Baglole 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 InvestorPlace.com Publishing Guidelines.