Will a 1-for-20 Reverse Split Save Workhorse (WKHS) Stock?


  • Workhorse (WKHS) just completed a 1-for-20 reverse stock split.
  • The company lost its effort to electrify the U.S. Postal Service fleet in 2021.
  • Workhorse is trying to reinvigorate the business with EV trucks and a partnership with a California dealer.
WKHS stock - Will a 1-for-20 Reverse Split Save Workhorse (WKHS) Stock?

Source: Photo from WorkHorse.com

Troubled electric vehicle (EV) company Workhorse (NASDAQ:WKHS) just held a 1-for-20 reverse stock split to maintain the Nasdaq’s minimum bid price requirement. The reverse split brought the price of shares from 15 cents to $3 apiece.

Shares fell 11% on June 13, when the reverse split was announced. Now, WKHS stock is down another 25% as of this writing to around $2.2o per share.

All Work, No Horse

Originally called AMP Electric Vehicles, Workhorse was founded in 2007 around the idea of converting gas-powered cars to EVs. The name Workhorse comes from the firm’s purchase of a Navistar subsidiary in 2012.

Since then, the company has become a manufacturer of electric vans. WKHS stock was hot during the EV excitement of 2020, as it sought a contract to build electric delivery vans for the U.S. Postal Service. At the time, I called WKHS a “bubble stock.”

In the end, the USPS awarded the contract to Oshkosh (NYSE:OSK). Workhorse protested the decision, noting that President Joe Biden wanted an all-electric fleet but Oshkosh didn’t promise one.

Oshkosh has since promised to increase the percentage of EVs in the order. But now the government is buying 9,250 electric vans directly from Ford (NYSE:F). Ford was originally designated to provide engines for the Oshkosh contract.

Workhorse, meanwhile, has faded. The company lost $123 million in 2023, or 60 cents per share, on sales of $13 million. Workhorse recently announced a contract with a California dealer for electric trucks.

What Happens Next?

The reverse split will give Workhorse time to get its business in order. But if it can’t generate a profit, the company won’t have much time.

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On the date of publication, Dana Blankenhorn 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.

Dana Blankenhorn has been a financial and technology journalist since 1978. He is the author of Technology’s Big Bang: Yesterday, Today and Tomorrow with Moore’s Law, available at the Amazon Kindle store. Tweet him at @danablankenhorn, connect with him on Mastodon or subscribe to his Substack.

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