Nikola Corp. tumbled Thursday after Nasdaq Inc. notified the company that it isn’t in compliance with the minimum bid requirements to remain listed on the exchange.
Shares of the electric truckmaker sank as much as 24%, the most intraday since November 2020. The stock is down 64% this year as of Wednesday close, when it ended the session with a price of 77 cents.
Companies on the exchange that aren’t able to maintain a minimum closing price of $1 per share for 30 consecutive business days risk getting delisted. Nikola’s shares haven’t traded above $1 since April 11.
It is the latest obstacle for the zero-emission vehicle startup that has faced high-level executive departures recently and has exited Europe to focus on its home turf in the US. Earlier this month, the company also reported first-quarter earnings results that was slightly worse than analysts had estimated.
JPMorgan analyst Bill Peterson wrote in a note earlier this month that while Nikola’s strategy and new focus makes sense, he is skeptical on the ramp of business and profitability profile compared to the company’s targets.
“In a challenging market environment, the company doesn’t have great options to raise capital at this stage, in our view,” Peterson wrote in a May 9 note.
The company said in the filing that Nasdaq’s notification doesn’t currently impact its listing on the exchange. Nikola has 180 calendar days or until Nov. 20 or to regain compliance with the listing rule, where its stock must close at $1 minimum for at least 10 consecutive business days.
