Yesterday, the investors of Abraxas Petroleum Corporation (NASDAQ:AXAS) got a bit of a shock after the end of the trading session as the company’s stock tanked by as much as 17% in the afterhours trading period. There was good reason for the decline in the stock as well.
On Friday, it emerged that the Nevada based company was sent in a notice by NASDAQ relating to the fact that it was no longer in compliance with the Nasdaq Listing Rule 5550(b) in relation to continued listing on the exchange. The possibility of being delisted from one of the world’s biggest stock exchanges came as a negative trigger for the Abraxas stock and hence, the selloff was not surprising.
As per the notice dated July 26, 2021, the total market valuation of the listed securities of Abraxas went below the $35000000 level on July 21, 2021. As per the rule cited by the exchange, it is the minimum market value that is necessary for a stock to remain listed on NASDAQ. That being said, after the receipt of the notice, Abraxas also sent in a plan by way of which it seeks to be compliant again.