Workhorse Shares Face Scrutiny Amid Financial Concerns

Workhorse US98138J2069

Shares of electric vehicle manufacturer Workhorse Group Inc. are under pressure following a series of regulatory disclosures that highlight significant financial challenges. The company's recent filings with the U.S. Securities and Exchange Commission (SEC) point to persistent liquidity issues and internal control weaknesses, casting doubt on its near-term operational stability.

A critical development emerged in Workhorse's recent 8-K filing, where its former auditor, Berkowitz Pollack Brant (BPB), included an explanatory paragraph in its audit report for the fiscal year ended December 31, 2024. This paragraph expressed substantial doubt about the company's ability to continue as a going concern. This formal warning underscores the severity of the liquidity constraints, even following the completion of its merger with Motiv Power Systems in December 2025.

Concurrently, Workhorse announced the dismissal of BPB and the immediate appointment of Carr, Riggs & Ingram (CRI) as its new independent registered public accounting firm. CRI had previously acquired certain capital markets assets from BPB. Such an auditor change during a period of financial strain can often lead to delays in finalizing annual reports and may complicate future efforts to raise capital.

Internal Controls and Ownership Structure

Further scrutiny of SEC filings reveals that management has reported unremediated material weaknesses in its internal controls over financial reporting. These deficiencies specifically relate to the valuation of convertible debt instruments and option liabilities. Issues with complex valuations, coupled with past delays in filing quarterly reports, have contributed to a cautious stance among institutional investors.

On the ownership front, a filing dated January 22, 2026, shows that entities related to Motive Holdings II LLC and Gary Magness hold an aggregate of 6,629,800 shares, representing their economic ownership. This consolidation of holdings post-merger alters the shareholder landscape but does not directly address the underlying financial risks.

Market Performance and Forward Challenges

The stock closed at $5.00 on the last trading day. Over the preceding ten sessions, it recorded losses in seven, declining approximately 9.26% in that period. Workhorse's share price has traded between a 52-week range of $4.77 and $94.85, a history that includes a reverse stock split executed on December 8, 2025.

The going concern notice indicates that, without securing significant new financing or achieving a material reduction in its cash burn rate, Workhorse may not maintain sufficient liquidity over the next twelve months. Management's ability to realize the projected $20 million in cost synergies from the Motiv merger is now a pivotal factor for improving the financial position.

Market participants are awaiting the next quarterly results to assess whether the leadership team, under CEO Scott Griffith, can stabilize operational cash generation. In the absence of near-term funding or substantial cost reductions, the equity is likely to face continued uncertainty and elevated volatility.