One of retail investors’ newest favorite plays is Microvast Holdings (NASDAQ:MVST). Investors are seeking out the play for a handful of reasons; bearish price points, high short interest and the fundamental strength of being a battery manufacturer during a transition to electric vehicles (EVs) are just a few. The stock is taking off this morning, after a busy day of gains yesterday. What’s driving MVST stock right now, and what are investors saying about it?
Microvast is a Houston-based designer, developer and manufacturer of lithium-ion batteries for use in EVs and commercial settings. Most prominently, the company has produced batteries for use in buses across Europe, Russia and China.
MVST stock has been a frequently discussed play among retail traders for some time now. But, interest has been increasing as Morgan Stanley (NYSE:MS) analyst Adam Jonas gives it a bearish $6 price point. A highly rewarded Reddit post saw one user say the price point is a time to buy, given Jonas’s bearish predictions often being wrong. Moderators are coming under criticism for removing the post, but the sentiment remains. Users bought in by the tens of millions yesterday to send the stock shooting skyward.
MVST Stock Sees Bullish Sentiment From Investors
Investors sent MVST rocketing by over 25% yesterday, removing shares from the float and leaving short sellers high and dry. Today is seeing the market take off after some big pre-market moves. Indeed, the stock is already up 17% in the opening moments of trading, and volume is already at 9 million, which is far beyond the daily average of 1.2 million.
Sentiment from investors online is quite bullish, with many pointing out that the gains occurred after Jonas’s prediction. But, while these investors are celebrating Jonas’s inadvertently catalyzing squeeze, others are praising Microvast for a different reason.
A deep dive on Reddit shows that investors are not just looking at MVST as a stock to pump. Rather, investors like Microvast because it has fundamental strength as an EV play. It is one of the only lithium-ion battery manufacturers that operates in the U.S.; much of the market lies in the hands of China.
As the U.S. and its home-team automakers pledge to make electric vehicles a priority, U.S.-born lithium-ion batteries are crucial. And especially as the Department of Energy looks to tap into domestic lithium mining operations, Microvast can count on growing its business.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.