Stocks are once again turning lower today as potential contagion fears in the banking sector hit the broader indices hard. That said, certain stocks are feeling today’s macro pain harder than others. Among the hardest-hit stocks of late, Mullen Automotive (NASDAQ:MULN) is on the decline again, with MULN stock losing more than 13% in this afternoon’s session.
This decline marked a fresh 52-week low for the embattled EV maker. Of course, today’s rationale for this decline appears to be simplistic, given the unfortunate macro backdrop facing all risk assets.
That said, Mullen is also a company with its share of company-specific concerns investors have been pricing in. Let’s dive into what investors have been watching with Mullen and what’s behind this decline today.
MULN Stock Sinks to Fresh 52-Week Low
As with many things in life, the movement of stocks isn’t typically driven by one single event in isolation. Today’s price action in MULN stock appears to be the result of several different catalysts that are all playing into the narrative that this company may struggle to survive. Thus, contagion fears in the banking sector may have provided the reason for investors to hit sell today, but they likely aren’t the only factor driving this downside pressure.
For one, Mullen is at risk of de-listing from the Nasdaq, having recently filed a 180-day extension to meet this requirement. Now trading under 15 cents per share, it’s looking less and less likely that this will happen. If Mullen fails to meet this threshold in the next three months, a reverse stock split will likely be needed for the company to stay listed. Generally speaking, that’s never a good thing for a particular stock.
Additionally, Mullen is embroiled in an ongoing legal battle, having received a court summons for its previous financing activities. The company’s chief accounting officer has departed, and the volatility with MULN stock has led to the company’s stock being put on the short sale restriction (SSR) list, which has been so well-covered by fellow InvestorPlace contributor Thomas Yeung.
These are enough headwinds to take any stock to its 52-week low. Thus, it looks as though many investors were simply looking for a reason to take the tax loss today in MULN stock.
On the date of publication, Chris MacDonald 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.