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Volcon Inc. (NASDAQ:VLCN), a player in the motor vehicle industry with a market capitalization of $0.5 million and annual revenue of $4.04 million, has announced the initiation of a share repurchase program. On Monday, the company disclosed through a regulatory filing that it has authorized the buyback of up to $2 million of its common stock. According to InvestingPro data, the company maintains more cash than debt on its balance sheet, potentially supporting this initiative.
The repurchase plan, which is set to be conducted through open market purchases, block trades, and privately negotiated transactions, will adhere to Rule 10b-18 and Rule 10b5-1 under the Securities Exchange Act of 1934. The program’s execution is subject to market conditions, legal requirements, and other relevant factors, with no certainty on the exact number of shares to be repurchased. This announcement comes as the stock trades at a notably low Price/Book ratio of 0.1, though InvestingPro analysis indicates the company is rapidly burning through its cash reserves.
Management retains the discretion to determine the specifics of the repurchase strategy, considering the company’s capital necessities, market trends, and legal obligations. Funded by existing cash balances, the buyback program is slated to run until March 7, 2026, but can be modified, paused, or terminated at any time based on the company’s judgment.
Volcon’s decision to implement a share repurchase program reflects a common corporate strategy aimed at returning value to shareholders. By reducing the number of shares outstanding, such programs can potentially increase earnings per share and the value of remaining shares.
The information is based on a press release statement filed with the Securities and Exchange Commission. Volcon, headquartered in Round Rock, Texas, specializes in the manufacturing of motor vehicles and passenger car bodies. The company’s stock is traded on the NASDAQ under the ticker symbol VLCN.
In other recent news, Volcon ePowersports announced it has raised approximately $9.47 million in gross proceeds through the sale of 1,831,558 shares of its common stock as part of an ongoing At-The-Market offering agreement with Aegis Capital Corp. This move aligns with Volcon’s strategy to access capital for its operations and growth initiatives. Additionally, Volcon has authorized a $2 million stock buyback program, reflecting the company’s confidence in its long-term strategy. The company has also entered into a significant supply agreement with Venom-EV, under which Volcon will supply up to $3 million worth of products, including electric golf carts.
Volcon’s partnership with Venom-EV includes an equity component, where shares of common stock will be issued based on the number of units purchased. The company has further expanded its reach in the golf cart market by securing an exclusive distribution agreement with Super Sonic Company Limited to distribute golf carts manufactured in Vietnam. This strategic move allows Volcon to benefit from lower import tariffs compared to Chinese imports. Meanwhile, Volcon’s recent board appointments include Karin-Joyce Tjon as Chair of the Audit Committee and Jonathan Foster as Chair of the Compensation Committee. These developments underscore Volcon’s efforts to strengthen its financial position and expand its market presence.
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