LOS ANGELES - Surf Air Mobility Inc. (NYSE: SRFM), a company specializing in regional air mobility, has been notified by the New York Stock Exchange (NYSE) of its noncompliance with the exchange's continued listing standards.
The notice, received on May 20, 2024, indicated that Surf Air Mobility's average global market capitalization fell below the required $50 million over a consecutive 30 trading-day period. Concurrently, the company's stockholders' equity was also reported to be under the $50 million threshold.
The NYSE's Minimum Market Capitalization Standard, as outlined in Section 802.01B of its Listed Company Manual, necessitates that listed companies maintain a certain market capitalization and stockholders' equity. To address this deficiency, Surf Air Mobility plans to submit a business plan within 45 days from the receipt of the notice. This plan will detail actions the company has undertaken or will undertake to regain compliance with the listing standards.
If the NYSE accepts Surf Air Mobility's business plan, the company will have an 18-month period to remedy the noncompliance while its shares continue to trade on the NYSE, provided it meets other listing standards. The notice does not immediately affect the listing of Surf Air Mobility’s Common Stock, which will remain on the NYSE during this period.
Despite the notice, there is no anticipated impact on the daily operations of Surf Air Mobility or its subsidiaries, nor on its reporting obligations to the U.S. Securities and Exchange Commission. The company has expressed confidence in its strategic plan and the capabilities of its leadership to execute it.
Surf Air Mobility, based in Los Angeles, operates the largest commuter airline in the U.S. and is working on developing powertrain technology to electrify aircraft fleets. This initiative is part of its broader strategy to reduce the cost and environmental impact of flying.
The information in this article is based on a press release statement from Surf Air Mobility Inc.
InvestingPro Insights
Surf Air Mobility Inc. (NYSE: SRFM) is currently grappling with market challenges, as evidenced by its recent noncompliance with NYSE's listing standards. The InvestingPro data paints a picture of the company’s financial health and market performance. With a market capitalization of 30.44 million USD, Surf Air Mobility falls short of the NYSE's minimum requirement.
The company's revenue growth, however, paints a brighter picture, showing a substantial increase of 308.44% over the last twelve months as of Q1 2024. Despite this impressive growth, the company's gross profit margin remains low at 2.18%, and it has reported a significant operating loss of -159.14 million USD during the same period.
Additionally, the stock's price has experienced a sharp decline, with a 1-month price total return of -21.9% and a staggering 1-year price total return of -88.35%. These figures suggest that investor confidence may be waning, which could be contributing to the company's compliance issues with the NYSE.
From the InvestingPro Tips, two key insights emerge for potential investors and current shareholders. Firstly, Surf Air Mobility operates with a significant debt burden and may have trouble making interest payments on its debt. This is a crucial consideration for evaluating the company's financial resilience. Secondly, the stock is currently in oversold territory according to the Relative Strength Index (RSI), which could indicate a potential rebound or at least a pause in the downward trend, depending on broader market conditions and company-specific developments.
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