EV startup Canoo (GOEV) is throwing out a lifeline to keep its shares listed on the NASDAQ exchange. Canoo announced a 1-for-23 reverse stock split Wednesday as share prices hit a new all-time low.
Canoo initiates a 1-for-23 reverse stock split to stay listed
The reverse stock split will go into effect on March 8, 2024, before the market opens. Canoo’s stock will continue trading under the ticker symbol GOEV.
What does Canoo’s reverse stock split mean for your shares? For every 23 shares of Canoo stock you own, it will be combined into one. For example, if you own 230 shares of GOEV stock, when the market opens on March 8, you will now have ten shares.
Although you own fewer shares, your ownership in the company will not change (other than how the price reacts).
The announcement comes as Canoo looks to regain compliance with the NASDAQ’s $1.00 minimum per share requirement.
Following the news, Canoo stock slid another 10% Wednesday to around $0.085 per share. To regain compliance, Canoo’s shares must trade above the $1.00 min for ten consecutive days by March 25.
Companies like Canoo will initiate reverse stock splits to bump up the stock price in hopes of attracting new investments. A better-performing stock can potentially allow the company to raise funds more easily, which will be key as Canoo looks to ramp production.
Although Canoo’s losses narrowed in Q3, the EV maker still lost $112 million. Through the first nine months of 2023, Canoo’s losses reached $273.6 million.
We will learn more about Canoo’s financial situation when it reports Q4 and full-year 2023 earnings later this month.
Canoo has made recent progress with deliveres of its commercial electric van officially kicking off last month. Although other vehicles have been delivered to the US Army, NASA, and others, those were for testing.
The EV maker also announced USPS is purchasing six LDV 190 delivery vans as part of its $40 billion investment plan.
Last week, Canoo’s electric “American Bulldog” pickup truck was spotted testing near its OKC manufacturing facility.
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