HOUSTON - Freight Technologies, Inc. (NASDAQ: FRGT), known as Fr8Tech, a company specializing in logistics management and technology-driven supply chain solutions, has announced a reverse stock split of its shares. The board of directors approved a one-for-twenty-five reverse split of the company's issued and outstanding ordinary shares. This adjustment will take effect when trading begins on September 25, 2024.
The reverse stock split will consolidate every twenty-five existing ordinary shares into one new share. Consequently, the total number of outstanding ordinary shares will decrease from approximately 35.8 million to about 1.43 million. Fr8Tech's ordinary shares will continue to be listed on the Nasdaq Capital Market under the ticker FRGT but will be assigned a new CUSIP number.
Shareholders will not receive fractional shares if their holdings are not divisible by twenty-five. Instead, holdings will be rounded up to the nearest whole share if the fractional share is one-half or more, or the fractional share will be canceled if it is less than one-half. This corporate action aims to elevate the per-share trading price to comply with Nasdaq's minimum bid price requirement for continued listing.
The reverse split will not alter the total number of authorized ordinary shares of Fr8Tech. Transhare Corporation has been appointed as the exchange agent for the reverse split process. Shareholders seeking further information can reach out to Transhare Corporation directly.
Freight Technologies operates a suite of AI and machine learning-powered platforms designed to optimize and automate various aspects of the supply chain. Its products, including Fr8App, Fr8Now, Fr8Fleet, and Waavely, cater to different needs within the logistics sector, from cross-border shipping to ocean freight management.
This announcement is based on a press release statement from Freight Technologies, Inc. and does not include any speculative information. The company's forward-looking statements are subject to various risks, uncertainties, and other factors that could cause actual results to differ from expectations.
In other recent news, Freight Technologies, also known as Fr8Tech, reported a 6.6% increase in revenue for the first half of 2024, totaling $8.1 million, alongside a 40% rise in gross profits year-over-year. The company has also launched its Transportation Management System (TMS), a digital command center for logistics teams. In a significant financial move, Fr8Tech resolved outstanding promissory notes and convertible notes with Freight Opportunities LLC, thereby strengthening its balance sheet.
On the collaboration front, Fr8Tech has partnered with Bayer (OTC:BAYRY) CropScience LP to provide truckload services for the 2025 season across six essential cross-border lanes in the United States. This partnership is expected to enhance Bayer's supply chain efficiency. Furthermore, Fr8Tech expanded its collaboration with Amazon (NASDAQ:AMZN) Mexico to include U.S.-Mexico cross-border shipping operations.
The company also reported steady growth in its Q4 2023 revenue, approximately $5 million for the quarter, marking a 7.5% increase from the previous quarter and a 16% rise from the same period in 2022. Despite potential Nasdaq delisting, these recent developments contribute to Fr8Tech's ongoing efforts to maintain a positive financial trajectory.
InvestingPro Insights
In light of Freight Technologies, Inc.'s announcement regarding the reverse stock split, current and potential investors may find the following InvestingPro Insights particularly relevant. First, analysts are expecting sales growth in the current year, which could indicate a positive outlook for the company's revenue streams despite recent challenges. This aligns with Fr8Tech's ongoing efforts to innovate within the logistics and supply chain sectors.
However, InvestingPro Tips suggest that Fr8Tech is rapidly depleting its cash reserves and is suffering from weak gross profit margins. These financial pressures are reflected in the company's current market capitalization of approximately $15.48 million and a negative price-to-earnings (P/E) ratio of -2.03 as of the last twelve months ending Q4 2023. Moreover, Fr8Tech's stock price has experienced significant volatility, with a 44.7% decline over the past month and a staggering 96.34% drop over the past year, emphasizing the stock's underperformance.
Additionally, the company's stock is trading near its 52-week low, and the valuation implies a poor free cash flow yield, which could be concerning for investors looking for profitability and solid financial health. With Fr8Tech not paying dividends to shareholders, the investment appeal may be limited to those with a high-risk tolerance or a focus on long-term growth potential in the tech-driven logistics space.
For those interested in a deeper dive into Fr8Tech's financial health and stock performance, InvestingPro offers additional insights and tips. There are currently 17 unique tips available on InvestingPro that provide a comprehensive analysis of the company's financial metrics and market trends.
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