United Kingdom startup Arrival has been out of the spotlight in recent weeks, but things are changing today. After one glowing analyst review, CIIG Merger (NASDAQ:CIIC) shares are revving up on Thursday. So what exactly has CIIC stock moving? And what else do you need to know ahead of the Arrival SPAC merger?
To start, investors should know that CIIG Merger is a blank-check company planning on bringing Arrival to the public markets. Importantly, Arrival is the maker of all-electric vehicles, including buses for mass transit. Going into the SPAC merger, it already has large customers like United Parcel Service (NYSE:UPS) lined up. It also has backing from institutional investors like BlackRock (NYSE:BLK) and auto experts like Hyundai (OTCMKTS:HYMTF).
So the story clearly is bullish for the Arrival SPAC merger and CIIC stock… but what happened today?
Essentially, analysts at Wolfe Research initiated coverage of CIIC stock with lots of nice things to say. Perhaps most importantly, they set a price target on shares of $50. Given a current trading price of nearly $29, that implies more than 70% upside.
Behind that price target are several factors that make Arrival stand out in the electric vehicle market. Going beyond the traditional passenger car market, it plans to cater to other transit needs with electric vans and electric buses. Arrival also plans to offer those cars at competitive prices, and make them in a way that is better on the business. As the startup puts it, it is using a microfactory model.
Considering all of these things, and the broad excitement in the EV sector, Wolfe Research sees great potential for CIIC stock. If Arrival can nab 10% of the van and bus markets, it would be looking at revenue between $15 billion and $16 billion. From there, the year-end price target of $50 makes sense.
Why CIIC Stock Is on the Move
So beyond a bullish analyst note, what makes the Arrival SPAC merger appealing? And why is CIIC stock on the move?
To start, Wolfe Research jumping on board with positive reviews and a $50 price target will go a long way. With these EV startups, especially ones coming public via SPACs, there are many unknowns. When Wall Street firms and leading analysts throw their weight behind a company, they have a good deal of influence. We saw this earlier in 2020 when TV analyst Jim Cramer recommended investors buy up CIIC stock. His recommendation alone was enough to launch a major rally.
Beyond that, Arrival is a little bit farther along in the EV development process than some of its peers. With preorders and existing customers, it has an advantage over other new debuts like Nikola (NASDAQ:NKLA). This is why many investors have considered it the U.K. Rivian. With other EV companies like Lucid Motors dominating the news cycle this week, keep a close eye on the Arrival SPAC merger. This company shines when it is in the spotlight, and further good news could keep it there.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer with InvestorPlace.com.