Nikola shares threatened with delisting, closing price at a record low of 62 cents
Nikola (NKLA), once a top stock in the early months of the pandemic, is in danger of being delisted from the Nasdaq (^IXIC). Shares of the battery and hydrogen-powered electric truck maker fell 20% Thursday to close at an all-time low of 62 cents a share.
The company said so received a risk notification letter from Nasdaqand noted that Nikola “does not comply with reserve bid price requirements.” Shares have closed below $1 a share for more than 30 consecutive business days.
Nikola has until November 20, 2023 to restore compliance. To qualify, the company’s stock must have closed at least $1.00 for at least 10 consecutive business days.
The Phoenix, Arizona-based startup has struggled to gain a foothold in recent years amid higher interest rates and challenges.
Nikola went public via a SPAC in June 2020. Shortly thereafter, the stock hit an all-time high of more than $65 per share as investors became excited about the electric vehicle industry and announced a partnership with General Motors (GM).
That deal was later watered down against Nikola and its founder Trevor Milton following a scathing short seller report by Hindenburg Research in September 2020.
The company initially rejected Hindenburg’s claims. Later that month, Milton resigned as chief executive officer.
In 2021, the company said in an internal review that Nikola and Milton had made some partially or fully inaccurate statements.
Higher interest rates and a tighter credit market have made financing more difficult for capital-intensive startups.
In late March, Nikola announced a $100 million common stock offering at $1.12 per share. The stock fell as much as 18% on the news. Nikola said it intends to use the net proceeds from the public offering for working capital and other general corporate purposes.
In April, Nikola announced Changes in the Board of Directors. There were also senior management changes earlier in the year, including the resignation of CFO Kim Brady.
Earlier this year, the startup celebrated the milestone of 100 Class 8s Nikola Tre Hydrogen Fuel Cell Electric Vehicles (FCEVs) sold. In early May, the company announced an order from AJR Trucking for 50 FCEVs.
Year-to-date, the stock is down more than 72%.
Ines is Senior Economic Reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre
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