- Lordstown Motors Corp (NASDAQ:RIDE) stock plunged Tuesday following the reverse stock split announcement.
- The original equipment manufacturer of electric vehicles announced that it would effect a 1:15 reverse stock split of its Class A common stock effective May 24, 2023.
- Lordstown Motors’ Class A common stock will begin trading on a split-adjusted basis on the Nasdaq under its existing symbol, “RIDE,” when the market opens on May 24, 2023.
- The reverse stock split helps improve the Class A common stock marketability and liquidity. A higher market price can make the Class A common stock more attractive to a broader range of institutional investors, professional investors, and other members of the investing public.
- In addition, the reverse stock split helps to increase the per share market price of the Class A common stock to satisfy Nasdaq’s $1.00 minimum bid price requirement.
- The stock has plunged 73.5% YTD and 13% last week.
- In May, Lordstown shared plans to shelve the production of its Endurance electric full-size pickup truck shortly, given the lack of investment and production delays.
- Lordstown warned that it might have to file bankruptcy after Hon Hai Precision Industry Co Ltd (OTC: HNHPF) affiliate Foxconn Ventures Pte Ltd sought to withdraw from a deal for a $170 million investment.
- Price Action: RIDE shares traded lower by 10.6% at $0.27 premarket on the last check Tuesday.
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