Electric vehicle maker Cenntro Electric (NASDAQ:CENN) is in the spotlight today. The automaker reported that Nasdaq informed it that it had broken one of the exchange’s rules. Specifically, CENN stock failed to receive a “closing bid price” of at least $1 per share for 30 consecutive business days.
New Jersey-based Cenntro makes “light and medium-duty commercial [electric] vehicles” for companies.
Cenntro noted that it has six months to comply with Nasdaq’s rule. Many other companies whose stock prices have dropped below $1 for an extended period have adhered to the rule by carrying out a reverse split of their stocks. Reverse splits reduce the total number of shares outstanding, causing the price of each share to surge.
Alternatively, in a scenario that’s significantly less likely to unfold, Cenntro can allow its shares to be delisted from the Nasdaq and move them to an over-the-counter exchange.
The Bottom Line on CENN Stock
Cenntro was acquired by Naked Brand, “a struggling clothing and intimate apparel retailer” in November 2021. Naked, which had formerly been a meme stock, subsequently changed its name to Cenntro, and carried out a 1-for-15 reverse stock split.
Cenntro currently markets several electric vans, an electric “off-road utility task vehicle,” and a small delivery truck that’s designed for urban areas.
On Dec. 21, CENN announced that it had begun shipping two of its EVs to customers in Europe, sparking a big rally in CENN stock. The company plans to exhibit a hydrogen-fueled semi-tractor early next month.
Last quarter, Cenntro reported revenue of $2.5 million, gross profit of $300,000, and an operating loss of $12.1 million.
On the date of publication, Larry Ramer 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.