In the past, I was wary about electric vehicle manufacturer Mullen Automotive (NASDAQ:MULN). However, my MULN stock analysis has gradually switched from full-on bearish to cautiously optimistic.
As more positive news items come in, the bullish argument for Mullen Automotive is only getting stronger.
For instance, Mullen Automotive’s majority-owned electric-truck manufacturer, Bollinger Motors, now qualifies for tax credits of up to $40,000 per vehicle.
This could substantially boost Bollinger’s vehicle sales in the current and future quarters.
I don’t do this very often, but I’m really changing my tune on Mullen Automotive. I’m not saying that anyone should mortgage their house to buy shares of Mullen Automotive stock.
However, a small position, say, half a percent of your portfolio, could actually make sense in 2024.
Is a MULN Stock Squeeze Happening Now?
On Friday, Feb. 16, MULN stock zoomed approximately 20% higher. I scoured the news sites and social media for a company-specific catalyst, but couldn’t find anything.
Perhaps there’s a short squeeze happening now, though this would be difficult to prove. At the very least, it feels like the sellers are exhausted. They were in charge in 2022 and 2023, but 2024 might belong to the buyers.
Indeed, this could be Mullen Automotive’s time to turn a corner. As you may recall, Mullen recorded its first revenue of $366,000 last year. Mullen Automotive just reported encouraging results for the company’s most recently reported quarter:
“Our net loss attributable to common stockholders after preferred dividends was REDUCED from $376.9 million for the three-month period ended Dec. 31, 2022, to $61.4 million for the three-month period ended Dec. 31, 2023.”
That’s not perfection, but it is improvement. I’m not claiming that Mullen Automotive will turn a profit in the current quarter. However, given the aforementioned tax incentives, Mullen might increase its sales and further reduce its profitability gap.
Bollinger Motors Announces Its First Authorized Dealer
In other news, commercial truck manufacturer Bollinger Motors (which, again, is majority-owned by Mullen Automotive) is celebrating a milestone moment. In particular, Bollinger just named its first authorized dealer.
Reportedly, LaFontaine Automotive Group will serve as Bollinger Motors’ first authorized dealer with two locations in Michigan. Mullen Automotive expects deliveries of Bollinger’s B4 chassis cab to begin in 2024’s second half.
This partnership, according to the press release, brings Bollinger Motors’ “portfolio to 54 retail franchises and 39 retail locations.” There will also be “additional announcements planned later in 2024.”
Granted, Mullen Automotive and Bollinger Motors aren’t operating on the level of much bigger automakers. This is, so far, a small-scale operation and that’s why investors shouldn’t “back up the truck” to buy MULN stock. However, Mullen and Bollinger appear to be making progress and demonstrating growth, and that’s what really matters.
MULN Stock Analysis: This Could Squeeze Higher in 2024
Maybe there’s a short squeeze in progress, or maybe not. What’s most important is that Mullen Automotive is improving its bottom line and Bollinger Motors appears to be in expansion mode.
So, as you can see, my current MULN stock analysis is cautious but still optimistic. If you can handle risk and volatility, a now is a good time to consider a tiny share position in Mullen Automotive.
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.
