In early February, it seemed as if Mullen Automotive (NASDAQ:MULN), after a rough 2022, was about to turn a corner. However, in recent weeks, investors have grown more bearish about MULN stock.

Shares in the electric vehicle maker have fallen by about 50% over the past few weeks. While Mullen has yet to re-test its all-time low (18 cents per share), it’s awfully close, changing hands today for around 22 cents per share.

This further dimming of sentiment may at first suggest it’s best to avoid MULN. However, upon taking a closer look, it’s clear that adopting the market’s bearish stance on this stock isn’t necessarily the key takeaway.

Rather, for some investors, it may just well be worthwhile to consider Mullen at present levels, albeit with a full understanding of the inherent riskiness of the situation. With that, let’s dive in, and find out why.

The Latest With MULN Stock

Mullen’s most recent price movements haven’t come on the heels of zero news. That is, there has been major news lately, with the company releasing a financial update to investors on Feb. 14, in conjunction with the release of its financial results from the preceding quarter (ending Dec. 31, 2022).

In this update, this early-stage EV maker disclosed its current liquidity (over $100 million), as well as anticipated capital commitments ($90 million). Mullen also recapped major milestones reached over the past few months. Unfortunately, this largely-positive “update” didn’t provide much of a boost for MULN stock.

Instead, investors focused their attention on the earnings release. For the quarter, Mullen reported operating losses of $73.6 million and a staggering $376.2 million in net losses. These losses were many times above that of the operating losses ($14.1 million) and net losses ($156.1 million) reported in the prior year’s quarter.

But while these numbers, horrendous by any measure, have resulted in many investors finally throwing in the towel on MULN, if you currently do not own it, as I put it above, this recent post-earnings sell-off is not necessarily a sign to stay away.

Cautiously Laying Out a Bull Case

There are plenty of commentators out there laying out a bear case for MULN stock. However, while a bear case can be argued, so too can a bull case, albeit more cautiously. MULN has been, and will continue to be a high-risk, high-potential reward situation, with emphasis on “high-risk.”

Yes, there is a moderate chance that Mullen ultimately fails in its current efforts to bring both passenger and commercial EVs to market, resulting in a total loss for its investors. Still, while it may be a long shot that it achieves success with the former, success with the latter may not be out of reach.

Reaching the production stage with its line of Class 1 electric cargo vans, in December the company locked down a $200 million order for 6,000 units. Expected to deliver these vehicles starting in the spring, a move to the commercialization stage is just around the corner for Mullen.

That’s not all. As InvestorPlace’s Eddie Pan discussed on March 3, there is plenty of potential with its Bollinger Motors investment. Mullen’s involvement with Bollinger could pay off, as the electric truck startup advances the development of its B4 Chassis Cab (designed for the commercial trucking market).

The Takeaway

Given the company’s progress in the area of commercial EVs, I wouldn’t write MULN off completely. However, while not necessarily a “no go” situation, let me reiterate that this isn’t a stock for all investors.

This is not only due to the moderately-high risk that MULN investors experience a total wipeout. Even if Mullen rides out its current challenges, it may take some time for the “payoff moment” to finally arrive.

To top things off, shares are likely to remain highly volatile in the meantime, especially as the market absorbs the prospect of this highly ambitious but cash-strapped company conducting additional capital raises.

That said, if you have a high risk tolerance, and are able to handle any volatility that may arise along the way, feel free to add MULN stock to your portfolio, as a small, speculative position.

MULN stock earns a B rating in Portfolio Grader.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.