Shares of Mullen Automotive (NASDAQ:MULN) stock began to trade above $1 after the company enacted a 1-for-25 reverse stock split on May 4. The reverse split, which was approved by shareholders at Mullen’s last special meeting of stockholders, was put into place in order to regain compliance with the Nasdaq’s minimum price requirement of $1. To regain compliance, a stock must trade at or above $1 for 10 consecutive business days.
Yesterday, May 17, marked the 10th consecutive day that MULN stock has traded at or above $1, which means it is now in compliance with Nasdaq’s minimum price requirement. This should remove a major overhang from the company as long as shares can continue to trade above $1. Mullen noted that it currently “awaits confirmation from Nasdaq that it meets Nasdaq’s requirements for continued listing as a result thereof.”
MULN Stock: Mullen Has Traded Above the $1 Minimum Requirement
Nasdaq first provided Mullen notice of its price deficiency on Sept. 7 because MULN had traded below $1 for 30 consecutive business days. Mullen was given a 180-calendar day grace period to regain compliance or until March 6. Shares of MULN failed to trade above $1 by then, which resulted in Nasdaq providing the electric vehicle (EV) company with a 180-calendar day extension, or until Sept. 5. Mullen didn’t wait around for the September deadline, as it enacted the reverse split earlier this month.
Shares are currently trading in the $1.20 range. A trip below $1 again for 30 consecutive business days would call for another Nasdaq price deficiency notice.
Meanwhile, the company has provided a slew of announcements in recent weeks. First, it reported its first-quarter earnings, which showed zero dollars in revenue and a net loss attributable to shareholders of $114.91 million, which actually improved from the loss of $324.60 million a year ago. In addition, Mullen has received approximately $279 million in Class 1 and 3 EV purchase orders from Randy Marion Automotive Group (RMA). Revenue from the purchase order is expected to flow in starting in August.
Yesterday, Mullen reaffirmed that production for its Class 3 EV, called the THREE, would begin in July. The company has teamed up with NRTC Integration to assist with the production.
On the date of publication, Eddie Pan 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.