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Forza X1, Inc., a company specializing in ship and boat building and repairing, will be delisted from The Nasdaq Stock Market LLC, as it failed to meet the minimum bid price requirement. The delisting notice, received on Monday, October 1, 2024, indicates that Forza X1's common stock did not maintain the necessary minimum closing bid price of $1.00 per share over the required period.
The company, headquartered in Ft. Pierce, Florida, was initially notified on October 4, 2023, of its non-compliance with Nasdaq's Listing Rule 5550(a)(2) after its stock price remained below the threshold for 30 consecutive business days from August 22, 2023, to October 3, 2023. Despite being given 180 calendar days to regain compliance, and an additional 180-day period that extended until September 30, 2024, Forza X1 was unable to meet the Nasdaq's minimum bid price requirement.
Trading of Forza X1's stock, which is traded under the ticker symbol NASDAQ:FRZA, will be suspended starting October 10, 2024. The company has chosen not to appeal the delisting decision. Following the suspension, Forza X1 expects its common stock to be traded on the OTC Markets system under the same ticker symbol "FRZA," ensuring that there will be no interruption in the ability to trade its shares.
In other recent news, Forza X1, Inc. has announced the departure of its president, Dan Norton, effective September 30, 2024. The company, which specializes in ship and boat building and repairing, has not yet revealed a successor or transition plan. In parallel, Forza X1 and Twin Vee PowerCats Co. have agreed to merge, aiming to leverage Twin Vee's history in boat manufacturing and Forza's focus on electric boats. This merger is expected to create a more competitive company with a strong balance sheet and no funded debt.
Further, Forza X1 has decided to halt the development and sales of its electric boats amid cost cuts, reducing its burn rate from $600,000 per month to approximately $230,000, with a target to reach less than $150,000 by the end of Q2 2024. The company is also seeking joint ventures and collaborations to enhance market reach and product offerings, and exploring strategic alternatives to maximize shareholder value with minimal financial risk.
InvestingPro Insights
Recent InvestingPro data sheds light on Forza X1's financial situation, providing context to its delisting from Nasdaq. The company's market capitalization stands at a modest $5.06 million, reflecting its small-cap status. Forza X1's price-to-book ratio of 0.42 as of the last twelve months ending Q2 2024 indicates that the stock is trading below its book value, which aligns with the company's struggle to maintain the required $1.00 minimum bid price.
InvestingPro Tips highlight that Forza X1 holds more cash than debt on its balance sheet, which could provide some financial flexibility as it transitions to the OTC Markets. However, the company is quickly burning through cash and is not profitable over the last twelve months, factors that likely contributed to its inability to meet Nasdaq's listing requirements.
The stock's recent performance reflects its volatility, with a strong 40.11% return over the last month, contrasting sharply with a 53.9% decline over the past year. This volatility is consistent with the InvestingPro Tip noting that the stock generally trades with high price volatility.
For investors seeking more comprehensive analysis, InvestingPro offers 17 additional tips for Forza X1, providing deeper insights into the company's financial health and market position during this transitional period.
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