Mullen Stock News: MULN falls more than 8% on Tuesday
- MULN stock loses another 8% on Tuesday, down 39% over past month.
- Mullen Automotive filed response with the Customs & Border Protection agency.
- Mullen ONE appears to be in the running for a federal contract alongside Rapid Response Defense Systems.
- Shareholders look ahead to vote on reverse split on December 15.
Mullen Automotive (MULN), a popular electric vehicle (EV) penny stock, descended more than 8% on Tuesday. Shares of the California-based company have trended 39% lower over the past month as the market awaits a shareholder vote on another reverse split scheduled for December 15.
The stock pulled back to $0.1620 in Tuesday’s session, down 8.7%, while the US stock market started off mixed but has produced light gains just before lunchtime.
Mullen stock news: Response for Mullen ONE filed with US Customs & Border Protection agency
On Monday, MULN stock closed slightly higher on news that it has filed a response alongside Rapid Response Defense Systems with US Customs & Border Protection (CBP), the federal agency that enforces law regarding customs duties, immigration and international trade.
The filing is a response to CBP’s questions regarding the sourcing of components used in the manufacture of Mullen’s Class 1 EV cargo van – the aptly-named Mullen ONE. The cargo van is manufactured at the company’s plant in Tunica, Mississippi, but uses parts sourced from distributors in South Korea, Germany, Romania, China, Canada and the US.
Rapid Response is a federal government contractor that is party to a $2.7 billion contract for federal vehicles with the General Services Administration. The company sources equipment and supplies for the US intelligence agencies, the Department of Defense and a number of other federal agencies such as CBP.
Back in March, Rapid Response named Mullen as its exclusive provider for Class 1 EV vehicles since the Mullen ONE is the only Class 1 EV available in the US market.
“With the federal government’s strong interest in electrifying a growing portion of its vehicle fleet, Mullen’s commercial portfolio is very well positioned,” said Fred Bouman, Rapid Response’s SVP – Federal, in a March statement.
Mullen will join Rapid Response in showcasing the Mullen ONE at a government vehicle conference in January 2024. Any large-scale contract with the federal government would be a big boost to Mullen’s reputation, as well as its balance sheet.
At the moment though, shareholders are focused on the December 15 meeting, wherein CEO David Michery will attempt to get the votes to enact the third reverse-stock split of the year. As per an agreement with the NASDAQ exchange, Mullen needs to raise its share price above $1 by late January of next year. The board has already approved a ratio of between 1-for-2 and 1-for-100.
Mullen Automotive FAQs
Mullen Automotive is a publicly-traded development-stage electric vehicle company based in Brea, California that typically uses outside partnerships to manufacture its vehicles. The company was founded in 2014 and currently sells self-designed electric delivery vehicles. Besides its commercial offerings, Mullen plans to begin manufacturing its Mullen FIVE EV crossover in late 2024 or early 2025. Mullen Automotive went public on the NASDAQ exchange through a reverse merger in late 2021.
David Michery has been the company’s CEO since he founded and incorporated the company in 2014. The existing company came from the merging of CODA Automotive and Mullen Motor Cars through acquisition. Michery is joined by Chief Financial Officer Jonathan New, Chief Commercial Officer John Schwegman and President of the Automotive Division Calin Popa.
Through a partnership with Randy Marion Automotive Group, Mullen distributes its Mullen One delivery van that has an electric range of 110 miles. Through an agreement with a Chinese manufacturer and distributor based in Ireland, the company also distributes the Mullen-GO Commercial Urban Delivery EV in Europe. In July 2023, Mullen will begin commercial production at its facility in Mississippi of its Class 3 EV Cab Chassis long-haul truck for immediate delivery. Through its 60% ownership stake in Bollinger Motors, Mullen will also reap the benefits of that company’s B1 SUV and B2 pickup truck, as well as other commercial vehicles in the future. The Mullen FIVE crossover vehicle is not slated for production until at least late 2024, but it is already taking reservations.
Mullen has been diluting its stock since going public in late 2021. This is because the company as of yet currently has little revenue from operations and no profits. The stock has fallen over 99% since the company’s reverse merger in November 2021, and the rapid dilution is mostly to blame. Taking into account Mullen’s 1-for-25 reverse stock split on May 4, 2023, Mullen had 33,338,727 shares outstanding on September 30, 2022, but 126,281,274 shares on March 31, 2023. The company is allowed to sell up to 200 million shares under current authorization.
Mullen stock forecast
Mullen stock has lost its supportive perch in the $0.1800 to $0.1700 range that lasted for the past two weeks. Once again MULN is descending lower as shareholders exit the company ahead of the reverse split vote. Investors like stock splits but not reverse splits for the most part.
MULN trades beneath its 9-day Simple Moving Average (SMA), always a bad sign. For a rally to emerge, bulls must first push MULN above the $0.2210 level that acted as the previous support floor in late October. This level coincides with the 21-day SMA, which gives it more significance.
MULN daily chart