Mullen stock is up 45%: another electric vehicle competitor?

Mullen Automotive has risen 30% since the beginning of trading yesterday. Investors need to be aware, however, that this company has plans in place that won’t see the company delivering its small range of electric vehicles until 2024. 

This article was originally written by MyWallSt. Read more insights from the MyWallSt team here.

What does Mullen Automotive do?

Mullen Automotive [MULN] is a California-based electric vehicle (EV) manufacturer that is targeting the US EV market. It has two models in development: its SUV, the Mullen FIVE, and a sports car model, the Dragonfly. The company is also developing solutions for electric fleets, a platform harnessing the use of artificial intelligence (AI), as well as the development of battery technology.

Is Mullen Automotive a penny stock?

Yes, as Mullen trades for less than $5 per share, it would be considered a penny stock. Mullen is a microcap with a current market capitalisation of $47m — which values the business significantly higher than where it traded last week. The company has seen positive sentiment in its direction following interviews with US-based motor enthusiast networks Cars Yeah and CarBuzz.

Where can I buy Mullen stock?

Mullen Automotive trades under the ticker MULN on the Nasdaq stock exchange. It went public via a stock-for-stock reverse merger. This is a strategy whereby a private company buys out a publicly traded business — in this case, it was Net Element [NETE]. By doing this, the company is able to bypass some regular IPO expenses and trade as a public company in a quicker timeframe.

Is Mullen stock a good investment?

Mullen has not yet produced any vehicles, and as a result, is incurring heavy losses while it undergoes the necessary research and development to get its business up and running. Production and deliveries are not expected to begin until the second quarter of 2024. As we know from the many other all-electric EV startups that have made their way to the public markets, these timelines can often be skewed. All in all, while Mullen poses an interesting opportunity for speculators, the company has a long way to go before it can be seen as a solid investment opportunity, and the risk-reward doesn’t look attractive for the faint of heart investors.

MyWallSt gives you access to over 100 stock picks, as well as providing free analysis, multiple podcasts, customised market updates straight to your phone, and much more. Sign up for free today.