Written by Cláudio Afonso | LinkedIn | X
Shares of electric vehicle startup Workhorse are rising more than 14 percent on Monday after TD Cowen analyst Jeff Osborne adjusted the firm’s price target from $0.35 (pre-reverse stock split) to $3.
The revised target comes after the executed last week a 1-for-20 reverse stock split to meet Nasdaq’s listing requirements of maintaining a stock price above $1 per share.
Based on the last closing price of $1.71, the new price target implies an upside potential of over 75 percent.
Previously, Osborne had cut the price target for Workhorse stock in late May from $0.50 to $0.35. The reverse stock split, conducted on June 17, aimed to increase the stock price in compliance with Nasdaq regulations.
Both Nikola and Workhorse were recently informed of their impending removal from the Russell 3000 Index, as per the preliminary list of additions and deletions posted by FTSE Russell.
The reverse stock split decision was made following approval from Workhorse’s stockholders at the 2024 Annual Meeting in mid-May.
Shareholders had authorized the Board of Directors to implement a reverse stock split within a ratio range of 1-for-10 to 1-for-20, with the Board opting for the maximum ratio.
To remain compliant with Nasdaq’s listing standards, Workhorse must maintain a closing bid price of at least $1.00 per share for a minimum of ten consecutive trading days by September 16, 2024. However, the company cautioned that meeting this price level is not guaranteed.
In its recent first-quarter earnings report, Workhorse revealed $1.3 million in sales, down from $1.7 million in the same period last year, primarily due to decreased sales of its W4 CC vehicles. The company’s net loss for the quarter was $29.2 million, compared to $25.0 million in the same quarter last year.
As of March 31, Workhorse reported having $6.7 million in cash and cash equivalents, $1.8 million in accounts receivable, $49.9 million in net inventory, and $14.2 million in accounts payable.
Written by Cláudio Afonso | LinkedIn | X
