Today’s traders have a lot to consider when it comes to electric vehicle (EV) manufacturer Mullen Automotive (NASDAQ:MULN). For one thing, a company insider has reportedly divested his stake in MULN stock. Also, an important meeting, in which Mullen Automotive’s shareholders were to decide on a potential reverse stock split, was adjourned to a later date.
First things first: Mullen Automotive Director Kent Puckett sold off his share position in the company. We know this because of a Securities and Exchange Commission (SEC) Form 4 filing.
Apparently, Puckett sold 100,000 MULN stock shares at 33 cents apiece on Dec. 15. As we’ll cover in a moment, the share price went down after Puckett’s sale. Is it possible that he knew something was amiss at the company?
That’s a question for Mullen’s stakeholders to consider but bear in mind that people sell stocks for many reasons. After all, it is December and that means it’s tax loss harvesting time. So, let’s not jump to any hasty conclusions.
What’s Happening With MULN Stock?
MULN stock jumped 8% immediately after the opening bell rang on Wall Street today and then pushed a bit higher. Even with that, though, the shares traded below Puckett’s 33-cent sale price.
It’s also worth noting that Mullen Automotive shares are far below the crucial $1 level. That price point is significant because, as Eddie Pan observed, “March 6 marks the deadline by which MULN stock must trade at a minimum closing bid price of at least $1 for 10 consecutive days in order to remain compliant with Nasdaq guidelines.”
To help remedy this problem, Mullen Automotive held a special meeting of stockholders on Dec. 23. On that day, Mullen’s shareholders were to vote on a possible reverse share split, with a range between 1-for-2 and 1-for-25.
A reverse split could raise the MULN stock price above $1, thereby solving the Nasdaq listing compliance problem. However, the special shareholder meeting was adjourned without achieving a quorum on the reverse stock split vote, so the motion failed to pass.
This definitely isn’t the end of the story. The special meeting of Mullen’s shareholders will reportedly reconvene on Jan. 19, 2023. So, mark your calendar for that date and be on the lookout for further developments with Mullen Automotive.
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On the date of publication, David Moadel 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.
