For anyone who was worried about the state of electric vehicle stock Mullen Automotive (NASDAQ:MULN), there’s less cause for alarm than you might think. Mullen noted that it can hold out on its current cash supply for a good while yet. However, it also offered up a more concerning point, but one that investors took well. Sufficiently well to send Mullen up over 15% at one point in Wednesday afternoon’s trading.
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Mullen revealed that it has enough capital on hand to cover at least 12 months’ worth of expenses. It also noted that its debt load is quite slim, as “…company assets are unencumbered” except for an outstanding $7.3 million in debt. Given that Mullen has $135 million in cash on hand, that debt is basically nonexistent or could be rendered so at any given time. That was enough to get Mullen to note that it’s trading at a “steep discount” between its current share price in the sub-whole-dollar range and its $135 million in available cash.
However, Mullen also isn’t taking chances. It’s declared a moratorium on investor financing for the rest of this year, which means it won’t be making much of unexpected moves like selling more stock or issuing bonds.
Mullen needed good news by any means available. The last five days in trading for Mullen Automotive stock have been mostly downhill, and that’s actually a decent description of the last year as well. The decline has slowed, but with a share price under the $0.50 mark, it doesn’t have much further to fall.