Nikola (NKLA) stock hit record lows last week after the maker of hydrogen fuel cell trucks announced a 1-for-30 reverse stock split, which was the maximum ratio it could have gone for. The reverse stock split, which will go into effect after today's closing bell, will correct Nikola’s violation of Nasdaq listing rules, as its share price was consistently trading below the exchange's minimum threshold of $1.
To be sure, maintaining its Nasdaq listing is important for Nikola, as the company needs to raise cash frequently by selling its shares. However, the reverse stock split might not be the end of Nikola’s woes, as we’ll discuss in this article.
