MULN Stock Forecast 2023, 2025, 2030: Welcome to another stock price prediction session. In this discussion, we will focus on MULN Automotive Inc., analyzing its potential future trajectory.
Mullen (NASDAQ: MULN) has experienced a significant downtrend in its stock price over the past few years, with shares reaching an all-time low of $0.088 in 2022, representing a decline of over 99% from its peak. Unlike other electric vehicle (EV) stocks such as Tesla and Nio, MULN has underperformed in 2023, seeing its stock price plummet by more than 80% from its year-to-date high.
Although the technology sector has witnessed a strong resurgence in the second quarter of 2023, MULN has struggled to attract investor attention due to its weak financial position. Recent data indicates that the company may be on the verge of bankruptcy, as it continues to deplete its cash reserves without generating any revenue.
What is MULN Automotive Inc.?
The automotive industry is undergoing rapid transformations, particularly in the realm of vehicle types being sold. According to data, electric vehicles (EVs) accounted for 10% of all new vehicle sales in the United States in 2022. Another significant change is occurring in China, where domestic brands have experienced substantial market growth in recent years.
Mullen Automotive, based in California, is among the numerous EV companies aiming to provide a viable alternative to Tesla and other EV manufacturers. The company is actively engaged in manufacturing its vehicles and is conducting research on solid-state battery technology, which has the potential to yield improved batteries if successful. Additionally, Mullen operates CarHub, a platform that facilitates car buying and selling.
Furthermore, Mullen Automotive has demonstrated a tendency towards acquisitions. In 2022, the company acquired Electric Last Mile Solutions (ELMS) in a deal worth $240 million. Mullen also obtained a 60.5% stake in Bollinger Motors, a manufacturer of electric trucks.
Mullen’s product lineup includes several car models, such as the Mullen FIVE, Mullen FIVE RS, Mullen Class 1 van, Mullen Class 3, Bollinger B1 and B2, Bollinger I-GO, and the Bollinger B4 platform.
|Company Name||Mullen Automotive Inc.|
|Headquarters||Brea, California, U.S.|
|Founded in||2014 (9 years ago)|
|Founded by||David Michery|
|Products||Electrical Vehicales and Batteries|
MULN Stock Latest News
In recent news, Mullen (MULN) has successfully raised an additional $110 million in funding by selling convertible preferred stocks, warrants, and promissory notes. This funding infusion will provide the company with increased financial resources.
Another significant development is the company’s announcement of the initial deliveries of its Class 1 EV Cargo Van. Mullen managed to meet the delivery deadline set by Michery, demonstrating its ability to deliver on its commitments.
To strengthen its business, Mullen has made key hires. Notably, Jerry Hu has joined as the company’s president of commercial vehicles, and Raj Pai has been appointed as the chief engineer of commercial vehicles. The company expressed satisfaction with the caliber of talent it has been able to attract from tier 1 suppliers, traditional original equipment manufacturers (OEMs), and other EV startups.
In May 2023, Mullen announced a reverse stock split at a 1:25 ratio. This move will consolidate the number of shares available in the market by this ratio, simultaneously increasing the price of each share. However, the company’s overall market capitalization will remain unaffected by this change.
Additionally, Mullen reached a deal with Newgate Motor Group, an Ireland-based company, in November. Under this agreement, Newgate will serve as Mullen’s marketing, sales, and servicing agent in Ireland and the UK, enhancing the company’s presence in these markets.
Why did MULN Crash?
The sharp decline in Mullen Automotive’s stock price can be attributed to several factors. Firstly, the company’s stock followed the trend of other companies that went public through the SPAC (Special Purpose Acquisition Company) model. This model involves merging with an existing company and is an alternative to traditional IPOs and direct listings. Many companies that pursued this route, such as Virgin Galactic, SoFi, OpenDoor, and Clover Health, experienced significant declines in their stock prices.
Secondly, Mullen Automotive’s stock price plummeted after a well-known short-seller released a damning report on the company. Hindenburg Research raised concerns about Mullen, citing significant challenges and accusing the company of fraudulent activities. The report specifically alleged that Mullen was rebranding Chinese vehicles and selling them as their own.
Furthermore, Mullen’s stock decline was in line with the broader trend seen among other EV companies. Tesla, for instance, witnessed a decline of over 70% in its stock price in 2022. Similarly, EV stocks like Rivian, Lucid, and Nio also experienced substantial drops as the industry’s growth slowed down. In response to weakening demand, Tesla implemented multiple price cuts. Additionally, rising interest rates and a broader reevaluation of American stocks contributed to the overall market sell-off.
Overall, the combination of the SPAC model’s performance, negative reports from short-sellers, and the general downturn in the EV industry contributed to the significant decline in Mullen Automotive’s stock price.
Will MULN Automotive go Bankrupt?
One major factor that negatively impacted the Mullen Automotive (MULN) stock price was the increasing risk of bankruptcy. Many EV companies have faced financial difficulties and failed in recent years. A key concern for Mullen was its significant cash burn rate. In 2022, the company experienced a substantial increase in losses, totaling over $740 million compared to $44 million the previous year.
The latest financial report (10-Q) of Mullen Automotive paints a worrisome picture for shareholders. In the past three months, the company did not generate any revenue while depleting $67.5 million in operating cash. Additionally, the company has further diluted shareholders by an additional 60%. These financial figures indicate a challenging situation for Mullen Automotive and have raised concerns among investors.
Is MULN Automotive is a good investment?
There are several reasons why investing in Mullen Automotive (MULN) stock may not be a good idea:
Firstly, the company does not have a proven track record of successful technology. This means that investing in Mullen is essentially betting on its future success and the effectiveness of its technology.
Secondly, Mullen is experiencing significant cash burn, with millions of dollars being spent every month. This raises the risk of the company facing financial difficulties and potentially even going bankrupt in the coming years.
Thirdly, Mullen has a history of changing its focus and plans. Initially, the company intended to develop an electric saloon, then it wanted to introduce China’s Qiantu K50 to the US market, and now it has shifted its attention to delivery trucks and other vehicles. Such changes in strategy can create uncertainty and make it challenging to evaluate the company’s long-term prospects.
Moreover, there are doubts about the future of electric vehicles (EVs) in the US market. Some believe that internal combustion engine (ICE) cars will continue to have a significant market share, casting doubt on the growth potential of EV companies like Mullen.
Lastly, building an EV company requires substantial investment, often in the billions of dollars, due to factors like potential recalls and other challenges. This adds further financial risk to companies like Mullen.
muln stock forecast 2023
Mullen stock is currently experiencing a significant downturn, as indicated by the NASDAQ: MULN chart. The stock is trading 90.5% below its yearly high and has reached its lowest level ever.
However, there are some positive signals to consider. The Relative Strength Index (RSI) and the Money Flow Index (MFI) are currently showing a bullish divergence. This implies that there may be a relief bounce or a temporary upward movement in the stock’s price.
Despite these indications, it is important to note that the overall forecast for Mullen stock remains bearish as long as the price remains within the falling wedge pattern depicted on the chart.
muln stock forecast 2025 | muln stock forecast 2030
In my opinion, there is a likelihood that Mullen Automotive may face bankruptcy by 2025 due to its substantial cash burn and the current rise in interest rates. If bankruptcy is avoided, it is probable that the company will resort to significant shareholder dilution in order to raise the necessary funds. This is consistent with the experiences of other companies like Tesla and Rivian, where scaling up production for electric vehicles has proven to be a capital-intensive endeavor. Consequently, Mullen will likely need to secure billions of dollars in funding over the next few years to support its operations and expansion.
Based on the analysis, it is evident that Mullen Automotive (MULN) has faced significant challenges in recent years. The stock price has experienced a sharp decline, reaching all-time lows, and the company’s weak financials, including high cash burn and increasing losses, have raised concerns about its future viability. Additionally, the lack of proven technology, the risk of bankruptcy, and the potential need for substantial capital raises further contribute to the uncertainty surrounding Mullen’s prospects.
While there have been some positive signals, such as potential relief bounces indicated by technical indicators, the overall bearish outlook remains unless there is a significant turnaround in the company’s financial situation and strategic direction.
Investors should carefully consider these factors before making any investment decisions related to Mullen Automotive stock. Thorough due diligence, analysis of the company’s financial health, and keeping an eye on industry trends and market dynamics are essential for making informed investment choices.