Nikola (NKLA), once a high flying stock during the early months of the pandemic, is at risk of being delisted from the Nasdaq (^IXIC). Shares of the battery- and hydrogen-powered electric truck maker sank 20% on Thursday, closed at an all time low of 62 cents a share.
The company said it received a risk notification letter from the Nasdaq, noting Nikola is “not in compliance with the minimum bid price requirements.” Shares have closed below $1 each for more than 30 consecutive business days.
Nikola has until November 20, 2023 to regain compliance. In order to do so, the company’s closing share price must be at least $1.00 for a minimum of 10 consecutive business days.
The Phoenix, Arizona-based startup has struggled to gain footing amid higher interest rates and challenges over the last several years.
Nikola went public in June 2020 via a SPAC. Soon after, the stock reached all-time highs of more than $65 per share amid investor buzz over the EV industry and a partnership announcement with General Motors (GM).
That deal was later slimmed down after a scathing short seller report in September 2020 from Hindenburg Research against Nikola and its founder, Trevor Milton.
The company initially denied Hindenburg’s claims. Later that month, Milton stepped down as executive chairman.
In 2021 the company said in an internal review Nikola and Milton had made some partially or wholly inaccurate statements.
Higher interest rates and a tighter credit market has made funding more challenging for capital intensive startups.
In late March, Nikola announced a $100 million common stock offering at at a price of $1.12 per share. The stock sank 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 to its board of directors. It also underwent C-suite changes earlier this year, including the retirement of Chief Financial Officer Kim Brady.
Earlier this year, the startup celebrated the milestone of 100 Class 8 Nikola Tre hydrogen fuel cell electric vehicles (FCEVs) sold. In early May, the company announced a purchase order made by AJR Trucking for 50 FCEVs.
Year-to-date the stock is down more than 72%.
Ines is a senior business reporter for Leak Herald Finance. Follow her on Twitter at @ines_ferre
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