There are no guarantees that California-headquartered electric vehicle (EV) manufacturer Mullen Automotive (NASDAQ:MULN) will succeed in five or 10 years. For this year, though, MULN stock has a genuine shot at doubling, tripling or more. And this doesn’t have to involve the quick-fix tactic of a reverse share split.
Don’t get the wrong impression here. Mullen Automotive has raised doubts about the company’s ability to continue as a “going concern.” Therefore, it’s not wise to pour one’s entire investment account into shares of Mullen Automotive.
On the other hand, a small stake with a high but reasonable price target could yield surprisingly good results. Sure, there’s a lot of competition in the EV space, but don’t count Mullen Automotive out of the race just yet.
What’s Happening With MULN Stock?
MULN stock traded above $1 during the summer of 2022, but it was between 30 cents and 40 cents recently. This occurred even while Mullen Automotive completed its successful “Strikingly Different” tour and introduced its I-GO Commercial Urban Delivery EV in Europe.
Those developments suggest that Mullen should be able to continue as a “going concern” at least through the end of this year. Beyond that, it’s a wait-and-see scenario.
It’s also encouraging to learn that Mullen Automotive is augmenting its team with experienced members from famous car companies. Those companies reportedly include General Motors (NYSE:GM), Ford (NYSE:F), Volkswagen (OTCMKTS:VWAGY) and Hyundai (OTCMKTS:HYMTF).
Mullen Automotive Avoids the Reverse Split Strategy
You might be bullish on MULN stock for the aforementioned reasons, or simply because you like Mullen’s futuristic-looking vehicles. Or, you may feel that Mullen Automotive is a prime target for a massive short squeeze.
Any or all of those factors could push the Mullen Automotive share price up in 2023. One thing that won’t likely happen anytime soon, however, is a reverse share split.
Some folks might have assumed that Mullen would enact a reverse share split to get MULN stock above $1. That’s an important price level because the Nasdaq exchange has sometimes been known to delist stocks that trade below $1 for too long.
After a recent stockholder meeting, however, Mullen Automotive announced that it “has no plans at the current time to effect a reverse split.” That’s a good thing in my opinion.
Reverse share splits aren’t a permanent solution to a Nasdaq delisting threat. They’re really just a tactic that provides a quick, temporary fix. It’s much better for the company to work hard to sell its products, which Mullen Automotive is certainly doing.
Besides, Mullen Automotive will probably request a compliance-period extension from the Nasdaq exchange, if necessary. That move would buy Mullen some time and possibly keep the company listed on the Nasdaq through most or all of 2023.
So, Here’s My MULN Stock Price Prediction for 2023
MULN stock is a zero-or-hero kind of stock. It’s been to $1 and much higher in the past, though. I expect Mullen Automotive to continue expanding its market footprint throughout the year, both domestically and globally.
Consequently, I anticipate that the Mullen Automotive share price will hit $1 at some point this year. At that point, it wouldn’t be a terrible idea to take profits. Mullen can delay the Nasdaq delisting threat for a while and hopefully through the end of 2023. As for 2024 and beyond, that’s a different story entirely, and it’s too soon to make any predictions about that.
On the date of publication, David Moadel did not have (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.