• Mullen Automotive announces another bullish twist to its story.

  • RRDS chooses it as a supplier of Class-1 vans for the government’s EV program.

  • Short interest remains high and will stay high until production and revenue are reported.

  • 5 stocks we like better than Mullen Automotive.

Investors watching Mullen Automotive (NASDAQ: MULN) will know that it just partnered up with Rapid Response Defense Systems and this is good news. Rapid Response Defense Systems is a leading government contractor specializing in partnerships with small businesses.

It was just awarded a new contract to provide the US government with light-duty EVs over the next few years. The contract is worth roughly $2.7 billion over the next 60 months and could significantly boost Mullen Automotive's revenue.

The GSA Fleet Vehicle Purchasing Program average more than 50,000 new vehicles per year, and Mullen is uniquely positioned as the only manufacturer with a class-1 option.

“With the federal government’s strong interest in electrifying a growing portion of its vehicle fleet, Mullen’s commercial portfolio is very well positioned," said RRDS SVP – Federal Fred Bouman. “Mullen’s Class 1 EV cargo van launches this year and will be the only class 1 EV van in the market. It is 100% electrified, making it a strong fit for federal government business.”

Mullen Automotive executing on its plans

This latest development indicates that CEO David Michery is executing plans and building momentum for the business. This opportunity came to light due to Ron Dixon, the new hire and head of government sales. Mr. Dixon was head of government sales at GM so he comes to the table with experience and contacts within the industry.

The caveat is that Mullen is not the “exclusive” partner as it alleges in its press release but one of the perhaps many partners that will meet the government’s EV demand. The takeaway is that Mullen has developed yet another visible path to revenue that will help launch it to success once production is begun.

Regarding production, the company teased the market with a video and pictures of its class-1 van sitting in the Tunica facility, but there is no word yet on when production will start.

“RRDS is all about providing solutions to the federal government,” said Mullen’s Manager of Government Sales Ronald Dixon. “ … In addition, RRDS will be a key vehicle supplier to the General Service Administration in an awarded 5-year multibillion-dollar vehicle contract. We are focused on selling our EV products to the federal government and view this relationship as a strategic step in accomplishing that goal.”

Before this news, Mullen revealed a partnership with Loop Industries and Menzies Aviation. Mullen and Loop have been exploring ways to grow business together, and Menzies Aviation is one path to that goal. Menzies, the world’s largest airport services provider, is exploring using EVs and Loop’s fleet services tools. The test is running at LAX and could result in sales and an affirmation of business for Mullen and Loop.

Mullen's deadline is at hand

Mullen investors will also know that March 6th is the deadline for shares to surpass the $1 mark. This threshold to maintain a NASDAQ listing may lead to a reverse stock split if the company can not cross it. The next news will probably be a request to extend the deadline, which gives the company another 6 months to meet listing requirements.

The reverse stock split was approved by shareholders and will come at the board's discretion. There is speculation such a move could spark a short squeeze, but the only guarantee is volatility. The short interest in this stock is very high, over 50%, and has it set up for a squeeze, but without good news to sustain a rally, the short sellers are more likely to reposition at higher prices than to walk away from this market.

The technical outlook: Mullen at a bottom, no rally yet

Mullen Automotive shares appear to be at the bottom, but there is not enough meat to the story to sustain a rally yet. At best, the stock will continue to move sideways as bulls and bears fight. A rally may start when the company announces production, vans, and sales. The rally may be substantial if it gets a firm order from one of its many potential buyers.

MULN

Share: Feed news

VALUEWALK LLC is not a registered or licensed investment advisor in any jurisdiction. Nothing on this website or related properties should be considered personalized investments advice. Any investments recommended here in should be made only after consulting with your personal investment advisor and only after performing your own research and due diligence, including reviewing the prospectus or financial statements of the issuer of any security. VALUEWALK LLC, its managers, its employees, affiliates and assigns (collectively “The Company”) do not make any guarantee or warranty about the advice provided on this website or what is otherwise advertised above. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. The Company disclaims any liability in the event any information, commentary, analysis, opinions, advice and/or recommendations provided herein prove to be inaccurate, incomplete or unreliable, or result in any investment or other losses.

Recommended content


Recommended content

Editors’ Picks

EUR/USD hovers around 1.0850 as US Dollar stabilizes

EUR/USD hovers around 1.0850 as US Dollar stabilizes

EUR/USD is trading sideways at around 1.0850 in European trading on Monday. A lack of fresh fundamental catalysts and holiday-thinned market conditions leave the pair oscillating in a tight range. 

EUR/USD News

GBP/USD keeps range near 1.2750 amid holiday-thinned trading

GBP/USD keeps range near 1.2750 amid holiday-thinned trading

GBP/USD is trading modestly flat, keeping its range near 1.2750 in the European morning on Monday. The pair is subject to thin liquidity and minimal volatility, courtesy of US and UK market holidays. 

GBP/USD News

Gold: Acceptance above $2,350 is critical to sustain the upturn

Gold: Acceptance above $2,350 is critical to sustain the upturn

Gold price is building on the recovery from two-week lows early Monday, as US holiday-induced thin market conditions support buyers. Besides, renewed optimism around China’s economic growth prospects and a fresh escalation in the war between Israel and Hamas provide extra legs to the ongoing rebound in Gold price.

Gold News

BTC/USD appears poised for further outperformance

BTC/USD appears poised for further outperformance

Last week was another positive for BTC/USD, which was up +1.9% as of London’s close on Friday despite finishing considerably off its best levels. Price movement on the weekly timeframe has been working between the limits of a potential bullish flag pattern.

Read more

Final full week of May welcomes updated inflation data

Final full week of May welcomes updated inflation data

Monday will likely be a snoozer, with US and UK banks closing in observance of Bank Holidays. The majority of focus this week will fall on Friday’s US PCE inflation for April, alongside personal income and spending. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures