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Nikola plans reverse stock split to rescue - shares in a downward trend
Nikola shares crash: rescue planned through reverse stock split. What does the future of the hydrogen truck builder look like? Read all the details here. #NikolaShare #ReverseShareSplit #Stock Exchange #Finance #Investment
Nikola plans reverse stock split to rescue - shares in a downward trend
Nikola shares have once again experienced a significant decline as investors have not been happy about their investment for some time. Last week the share price fell even further below the one dollar mark. This is due to a planned corporate action aimed at keeping the company listed on the stock exchange.
Nikola shares lost more than 30 percent of their value in the last week of trading, putting investors on a roller coaster ride with the shares. Nikola's ongoing downward trend has left the company at risk of delisting from the NASDAQ as its share price trades below $1. To prevent this, the company is planning a reverse stock split, in which the number of shares traded is reduced in order to strengthen the stock market price.
The implementation of this measure depends on the approval of Nikola shareholders, who were asked to consolidate shares at the end of last week. A reverse stock split is proposed to ensure Nikola remains listed. The planned measure envisages that between ten and 30 shares will be merged into one share in order to increase the trading price of the shares and avoid delisting from the NASDAQ.
The shareholders' decision regarding the reverse stock split will be made at the annual general meeting and the outcome is currently uncertain. Nikola has 180 days to bring its price above $1 after NASDAQ warned of a possible delisting in January. The upcoming quarterly results will give investors further insight into the company's financial situation, which has recently been struggling with losses and falling sales.
Nikola shares were last traded on the NASDAQ with a 6.67 percent decline at $0.6536. The all-important $1 mark remains out of reach, and the company's future depends critically on shareholder approval of the reverse stock split.