Mullen Automotive Stock Gains on News of EV Delivery: So Why is it Time to Sell?

On Wednesday (December 27), Mullen Automotive (MULN) announced that it had delivered its latest batch of EV vehicles to Randy Marion Automotive Group (RMA). Mullen Automotive will earn $3,969,000 for the delivery.

This delivery consisted of 63 Class C vehicles and was part of a larger order from earlier this year. RMA originally ordered 1,000 vehicles with the first wheels being delivered just a few months back in September. 

The Class 3 EV cab chassis trucks are designed specifically for urban “last mile” delivery. However, the trucks can be tailored for other use cases – ranging from construction to landscaping, catering, and more. The truck boasts a 125-mile range with a 5,000-pound payload.

This is just one of the EVs Mullen manufactures, the other being the Mullen ONE – a class 1 EV cargo van. 

With this delivery complete, Mullen has now delivered 121 total EVs for a value of $7.5 million. The company said it intends to deliver another batch of vehicles before the year’s over, so there are still a few days to get in the remaining 30 or so EVs originally forecasted. 

That being said, the majority of vehicles will be delivered in 2024 as Mullen ramps up production. With a plant based in Tunica, Mississippi production can scale as high as 3,000 vehicles in the new year.

News of this delivery sent MULN shares more than 46% higher in the past week, correcting a negative trend that had gripped the stock for a while. It’s still down more than 66% in the past 3 months.

So, where does this leave investors? Is this a turning point for MULN, or is it still too early to make a bet on this stock? We’ve found 3 things to help you make your decision through the VectorVest stock forecasting software.

Despite Fair Upside Potential, MULN Has Poor Safety With Very Poor Timing

VectorVest tells you what to buy, when to buy it, and when to sell it - eliminating guesswork and emotion from your trading strategy. The proprietary stock-rating system is comprised of 3 easy-to-use ratings: relative value (RV), relative safety (RS), and relative timing (RT).

Each rating sits on a scale of 0.00-2.00 with 1.00 being the average, making your analysis quick and easy. It gets easier, though - because VectorVest issues a clear buy, sell, or hold recommendation for any given stock at any given time based on its overall VST rating. As for MULN, here’s the current landscape:

• Fair Upside Potential: The RV rating compares a stock’s long-term price appreciation potential (based on a 3-year projection) to AAA corporate bond rates and risk, offering far better insights than a simple comparison of price to value alone. MULN has a fair RV rating of 1.09. The stock is currently undervalued, too.
• Poor Safety: The RS rating is a risk indicator calculated through an analysis of the company’s financial consistency & predictability, debt-to-equity ratio, business longevity, sales volume, price volatility, and other factors. MULN has a poor RS rating of 0.52 right now.
• Very Poor Timing: Even though MULN is starting to turn things around, the stock still has very poor timing after watching 99% of its value dissipate in the past year. The RT rating of 0.16 is very poor. It’s based on the direction, dynamics, and magnitude of the stock’s price movement day over day, week over week, quarter over quarter, and year over year.

The overall VST rating of 0.66 is poor for MULN, and the VectorVest system has placed a SELL recommendation on this stock. You can learn more about the current situation through a free stock analysis today!

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VectorVest advocates buying safe, undervalued stocks, rising in price. MULN may be climbing higher on news of ramped-up deliveries for its EV lineup, but the stock’s upside potential is just fair. Meanwhile, its safety is poor and its timing is very poor.

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