HeartCore Enterprises, Inc., a computer processing and data preparation services company, has received a notice from the Nasdaq Listing Qualification Department indicating non-compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market. The notice, dated October 22, 2024, follows an earlier warning received by the company on October 26, 2023.
The company, traded under the symbol HTCR, failed to maintain the required $1.00 minimum bid price per share. Initially, HeartCore was given 180 calendar days, until April 23, 2024, to rectify the situation. Despite being granted an additional 180 days to regain compliance, HeartCore has not been able to meet the minimum bid price requirement.
As a result of this failure, trading of HeartCore’s common stock is at risk of suspension beginning October 31, 2024, unless the company files an appeal by October 29, 2024. HeartCore has expressed its intention to appeal the decision, which would delay the suspension and delisting process until the Nasdaq Panel reaches a decision.
The company is exploring possible actions to regain compliance with Nasdaq’s continued listing requirements. However, there is no guarantee that HeartCore will be able to resolve the deficiency and prevent delisting. The information is based on a press release statement and the company’s SEC filing.
In other recent news, HeartCore Enterprises reported significant revenue of $17.9 million from SBC Medical Group Holdings Inc.’s initial public offering. The income was primarily due to initial fees and warrants valued at $17 million, including a $9 million sale of warrants to a Japanese financial institution. After accounting for a referral fee to So Management Inc., net sales were reported at $5.64 million.
HeartCore Enterprises has also partnered with Tosho Computer Systems Co., Ltd. (TCS) to boost sales of its investor relations support tool, irVision. This collaboration aims to leverage the established client networks of both companies to provide enhanced value and expand their reach into new business territories.
In other developments, HeartCore has secured a contract with Fourmix Co., Ltd. to integrate its Content Management System (CMS) platform into Fourmix’s web development and digital marketing operations. This move is intended to enhance Fourmix’s ability to deliver customized information to meet specific customer needs more effectively.
Furthermore, HeartCore held its annual virtual meeting of stockholders, where shareholders voted on key proposals including the election of directors and an amendment for a reverse stock split. All six nominees for the Board of Directors were elected to serve a one-year term, and the company received approval from its shareholders to implement a reverse stock split of its common stock.
The company has projected revenues between $19 million and $23 million for Q3 2024, with a net profit ranging from $4 million to $8 million. Compared to the first nine months of 2023, where the revenue was $18.5 million, HeartCore expects to generate between $28.1 million to $32.1 million in revenue for the same period in 2024.
InvestingPro Insights
Recent data from InvestingPro sheds light on HeartCore Enterprises’ financial situation, providing context to the company’s Nasdaq listing challenges. As of the last twelve months ending Q2 2024, HeartCore reported revenue of $17.13 million, with a concerning revenue growth decline of 3.23%. The company’s operating income stands at -$7.14 million, indicating significant operational challenges.
Despite these difficulties, InvestingPro Tips highlight that HeartCore pays a significant dividend to shareholders, with a current dividend yield of 7.69%. This high yield could be attracting some investors despite the company’s financial struggles. Additionally, the stock has shown strong returns recently, with a 22.35% price total return over the past month and a 45.73% return over the last three months.
These metrics provide a more comprehensive picture of HeartCore’s financial health and market performance, contextualizing the company’s struggle to maintain Nasdaq listing requirements. InvestingPro offers 15 additional tips for HeartCore Enterprises, providing further insights for investors navigating this complex situation.
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