On Wednesday, shareholders of Mullen Automotive (NASDAQ:MULN) stock exchanged 1.07 billion shares. This marked a record high for the company and more than doubled its previous record. Yesterday, Mullen achieved the accomplishment of becoming the most traded stock among retail investors, according to data from JPMorgan. Tesla (NASDAQ:TSLA), which is usually the most traded stock, came in second for the day.
Mullen’s surge in volume was due to several announcements. The electric vehicle (EV) company recently announced an up to $25 million stock buyback program that will be in effect until Dec. 31. The company also disclosed that it believes that its stock is “significantly undervalued” in light of a roughly $235 million cash position. Using SEC filings from June 22, its current market capitalization sits at approximately $122.24 million.
MULN Stock Alert: Mullen Becomes Retail Investors’ Most-Traded Stock
At the same time, shares of MULN are still down by over 95% year to date. Mullen believes that something sinister may be at play here. Indeed, the company recently retained Christian Attar, formally known as Christian Levine Law Group, to assist with its market manipulation and naked short selling investigation.
Before that, the company retained application and analytics service provider ShareIntel. ShareIntel specializes in helping public companies track and analyze trading information using its “Data Repository Information Link” (DRIL-Down™) process.
What’s more, Mullen will finally be able to report revenue. For the quarter ended June 30, the company has obtained at least $308,000 from the sale of 22 EV cargo vans to Randy Marion Automotive Group (RMA). “These shipments are significant as they represent the first revenue recorded on our financial statement, reflected on the June 30, 2023, 10-Q,” said CEO David Michery.
To get to where it is today, Mullen has engaged in dilution, which harms shareholders. As of June 22, there were 643.37 million shares outstanding. On top of that, more dilution may be on the way. Several proposals that will be voted on at Mullen’s annual meeting of stockholders on Aug. 3 have the potential to increase dilution.
For example, one proposal seeks to increase the number of shares authorized under the 2022 Equity Incentive Stock Plan by 52 million. Additionally, another proposal seeks to change Mullens’ state of incorporation to Maryland from Delaware. Maryland allows companies to increase authorized shares of any class of stock without shareholder approval.
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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.
