LuxUrban Hotels Inc., a real estate company specializing in hotel operations currently trading at $0.75 with a market capitalization of $1.77 million, has received a notification from The Nasdaq Stock Market LLC indicating a failure to comply with listing requirements. According to InvestingPro data, the company's financial health score is rated as "WEAK," with significant challenges in maintaining stable operations.
On Thursday, the company was informed that it had not conducted its annual shareholder meeting within the required timeframe following the end of its fiscal year, violating Nasdaq's Listing Rules 5620(a) and 5810(c)(2)(G).
The notice from Nasdaq, received on January 9, 2025, does not currently affect the trading of LuxUrban's common and preferred stock, which continue to be listed under the symbols "LUXH" and "LUXHP," respectively. The company, headquartered in Miami, Florida, is expected to respond to the notice by January 16, 2025, detailing its plan to address this deficiency. The stock has experienced significant volatility, with a 94% decline over the past six months and a current debt-to-capital ratio of 0.96.
LuxUrban Hotels, previously known as Corphousing Group Inc., is exploring all possible avenues to regain compliance with Nasdaq's standards. The company's stock will remain listed and tradable on the Nasdaq while it works to satisfy the exchange's requirements.
In other recent news, LuxUrban Hotels Inc. has made several significant developments. The company reported a net loss of $26.8 million for the second quarter, with revenues decreasing to $18.2 million. Amid these financial challenges, Jones Trading downgraded LuxUrban's stock from Buy to Hold. LuxUrban also announced the resignations of board members Jeffrey Webb and Patrick McNamee.
In a bid to raise capital, the company revealed plans to sell up to $5 million in senior notes due 2027 and successfully closed a follow-on public stock offering, generating approximately $5.1 million. LuxUrban also entered into a $7 million joint venture with Lockwood Development Partners LLC and The Bright Hospitality Management, LLC, aimed at enhancing hotel operations and guest experiences.
The company is currently facing a potential Nasdaq delisting due to non-compliance with the minimum market value requirement. Despite a previous warning and a 180-day period to regain compliance, LuxUrban has been unable to meet the Nasdaq Listing Rule 5550(b)(2). However, LuxUrban has secured a conditional extension for its Nasdaq listing following a hearing with the Nasdaq Hearings Panel.
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