Arcimoto (FUV) Stock Falls After 1-for-20 Reverse Split

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  • Arcimoto (FUV) stock is falling hard today after enacting a reverse stock split.
  • This saw the company consolidate every 20 shares of FUV into one share.
  • The company conducted the reverse split to avoid delisting from the Nasdaq.
A magnifying glass zooms in on the logo for Arcimoto, Inc. (FUV Stock)

Source: Pavel Kapysh / Shutterstock

Arcimoto (NASDAQ:FUV) stock isn’t doing so hot as the electric vehicle (EV) company’s shares fall following a 1-for-20 reverse stock split.

That reverse stock split has Acrimoto consolidating down every 20 shares of FUV stock into one share. The goal of this reverse stock split is to push the company’s share price above the $1 mark. Doing so will allow Arcimoto to avoid delisting from the Nasdaq.

The Arcimoto reverse stock split went into effect after markets closed on Tuesday. That resulted in shares trading under the increased price when markets opened this morning. It’s worth noting that a reverse stock split doesn’t change a company’s market capitalization or a given investor’s stake in the company.

Why Is FUV Stock Down?

When a company has to use a reverse stock split to avoid being delisted, it doesn’t inspire confidence in investors. As a result, it’s not uncommon to see shares drop after a company undergoes a reverse split.

This can also cause investors to sell after the split has happened. This appears to be what’s happening today, with some 108,000 shares of FUV stock on the move as of this writing. For the record, the company’s daily average trading volume is closer to 52,000 shares.

FUV stock is down 3.1% as of Wednesday morning.

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On the date of publication, William White did not hold (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.


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