Majesco Entertainment on Friday got an official delisting warning from the NASDAQ stock exchange.
The "Cooking Mama" publisher has been put on notice for failing to comply with the exchange's minimum value standards, which dictate the share price of every stock stays above one dollar: Majesco's stock price has been stuck below $1/share for the last 30 days. After recieving the notice, Majesco has 180 days (Six months, give or take.) to raise their stock price above the minimum for at least ten consecutive days of trading.
This will be Majesco's third delisting notice from the NASDAQ in the last six years. The publisher was able to avoid delisting in 2009 and 2010.
Now-defunct publisher THQ's road to insolvency began in January 2012 when the publisher recieved a similar delisting notice. THQ was able to avoid delisting at the last second by consolidating their stock with a 10-to-1 reverse split. THQ declared bankruptcy in December 2012, and was forced to sell their assets in January.
Majesco's stock price dropped dramatically in January after the company announced it would no longer provide "quantitive financial guidance" to investors on a regular basis. In other words, the company will no longer disclose how much money the company and its products have made or lost. The following is from Majesco's Q4 2012 financial disclosure:
"As a result of the weakness in demand for products on legacy console platforms and uncertainty around consumer adoption of the next generation of consoles, management is modifying its practice of providing quantitative fiscal year revenue and earnings guidance. Instead, for fiscal 2013, management is presenting a qualitative assessment of its outlook for financial results."
Again, THQ made a similar decision during its last financial disclosure in November 2012, causing the company's stock to drop 50 percent the following day.
Does Majesco have any chance at keeping themselves afloat? Let us know what you think in the comments.