HOUSTON, TX – Vertex Energy (NASDAQ:VTNR) Inc., a petroleum refining company, has received a notification from The Nasdaq Stock Market LLC indicating non-compliance with the exchange's minimum bid price requirement. The notice, dated Thursday, August 29, 2024, stated that the company's common stock had not met the minimum bid price of $1.00 per share for 30 consecutive business days, as required by Nasdaq Listing Rule 5550(a)(2).
Despite the warning, Vertex (NASDAQ:VRTX) Energy's stock will continue to be listed on the Nasdaq Capital Market for the time being. The company has been granted a 180-day period, until February 25, 2025, to regain compliance. To achieve this, the closing bid price of Vertex Energy's common stock must reach or exceed $1.00 per share for at least 10 consecutive business days.
If compliance is not reached by the February deadline, Vertex Energy may be eligible for an additional 180 days to meet the requirement, provided it meets all other initial listing standards for The Nasdaq Capital Market and commits to addressing the bid price deficiency, potentially through a reverse stock split.
Failure to regain compliance within this timeframe may lead to delisting, although the company would then have the opportunity to appeal the decision before a Nasdaq Hearings Panel. Vertex Energy, which has its headquarters at 1331 Gemini Street, Suite 250, Houston, Texas, is actively monitoring the situation and considering all available options to resolve the minimum bid price issue and maintain its Nasdaq listing.
In other recent news, Vertex Energy reported a challenging second quarter in 2024, with a 28% decline in crack spreads compared to the first quarter, leading to a net loss of $53.8 million. Despite these conditions, the company managed to decrease operating expenses by 6% quarter-over-quarter and 12% year-over-year.
The company is focusing on transitioning the hydrocracker unit from renewable diesel production to conventional feedstock and has secured an additional $35 million in loans to manage liquidity during this transition.
The company's outlook includes an anticipated improvement in throughput in Q4 following a planned Q3 maintenance turnaround. Vertex Energy aims to increase its cash position, reduce operating costs, and improve margins despite market volatility.
New offtake agreements have been entered, including a jet fuel contract starting April 1st, marking a significant milestone for the company.
InvestingPro Insights
As Vertex Energy Inc . faces challenges with Nasdaq's minimum bid price requirement, a glance at real-time data from InvestingPro provides additional context for investors. With a market capitalization of just $38.62 million and a Price / Book multiple of 0.31 as of the last twelve months ending Q2 2024, the company's valuation reflects some of the concerns flagged by the exchange. The revenue growth has been modest at 2.66% over the same period, and the stock is trading near its 52-week low, which may concern potential investors.
InvestingPro Tips highlight that Vertex Energy operates with a significant debt burden and is quickly burning through cash. These factors, combined with weak gross profit margins of 4.58%, underscore the operational challenges the company faces. Vertex Energy's stock has also taken a significant hit over the past week, month, and year, with the price total return plummeting by 90.63% over the last year, indicating a bearish trend for the stock.
For investors seeking a deeper analysis, InvestingPro offers additional tips, including insights on the company's short-term obligations versus liquid assets and analyst expectations regarding profitability. With a total of 17 InvestingPro Tips available, including those not mentioned here, investors can explore a more comprehensive analysis to inform their decisions. For more details, visit InvestingPro's dedicated page for Vertex Energy at https://www.investing.com/pro/VTNR.
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