Mullen Automotive (NASDAQ: MULN) stock price has remained in a deep sell-off and is nearing its all-time low despite making some important announcements. It has crashed by over 82%, making it one of the worst-performing electric vehicle companies in Wall Street, bringing its market cap to over $43 million.
Mullen Automotive’s progress
Mullen Automotive, a Tesla wannabe, has made a lot of progress in the past few months. On June 13th, the company said that it had received a $13.2 million sales order for its Bollinger Motors business.
These orders came from Momentum Groups,a company that offers fleet solutions. They came a month after the company announced an order of 50 vehicles to EnviroCharge.
Mullen Automotive also received an order for 40 Mullen-Go urban delivery vehicles from Antidoto SA, a Swiss company. It has also continued to expand its dealer networks with Amerit Fleet Solutions in a bid to boost its market share.
And most recently, the State of Massachusetts announced that it would provide a $15,000 voucher per each truck sold. This is a major announcement since Mullen’s trucks mostly sell for less than $70,000.
Most importantly, the company announced a $150 million financing commitment from a family office. In the statement, Mullen noted that these funds will be enough to last for the next 13 months.
Still, the company faces substantial challenges ahead. In the last earnings statement, the firm said that it had delivered 362 vehicles valued at about $16.3 million in the previous six months. However, it deferred revenue recognition until the invoices are paid.
This raises question about how Mullen is conducting its business if it can sell 362 vehicles in six months and not receive the payments.
The results also showed that the company’s net loss came in at $235 million, an improvement from the $495 million it lost in the same quarter in 2023.
At the same time, Mullen’s balance sheet is still having issues as the amount of cash dropped to $22.3 million from $155 million a year earlier. Its working capital, which is calculated by subtracting current liabilities from current assets narrowed to $5.3 million from over $60 million.
Mullen Automotive stock price forecast
Turning to the daily chart, we see that the MULN share price has crashed hard in the past few weeks. In this period, the stock has remained below all moving averages while the volume traded each day has plummeted.
Further, the accumulation and distribution indicator has crashed to its lowest level since April this year. The Klinger Oscillator has also tumbled.
Therefore, the stock will likely continue falling as sellers push it below the key support level at $2.0. If this happens, the stock could continue falling, with the next point to watch being at $1.50.
Still, there is a risk that the stock could go through a short squeeze in the coming months as we have seen with AMC, GameStop, and even Mullen Automotive.
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