One explosive stock that has since fizzled this year is Naked Brand (NASDAQ:NAKD). Although shares nearly doubled in the year to date, recent months have seen NAKD stock cool down.
This retailer of men’s and women’s swimwear and intimate clothing products has been hit hard by the pandemic. As a result, Naked Brand has made some intriguing pivots this year. The company has refocused its energy on growing its e-commerce business. Additionally, it has looked to reallocate its capital to other high-value projects.
Like many other small-capitalization retail stocks, NAKD stock was able to ride the wave of retail hysteria earlier this year. But where will it go in 2022 and beyond?
For growth investors looking to take on a bit more risk, there’s a catalyst that may be enticing to some. Let’s dive into what investors are watching with this stock.
NAKD Stock Down on Closing of EV-Related Acquisition
The big catalyst most investors have had on their radar with NAKD stock is a recent acquisition. Today, Naked Brand announced the closing of its acquisition of EV startup Cenntro Automotive.
This deal leaves the combined company with $250 million in cash on the balance sheet, and provides a strong growth runway for those bullish on the EV sector. It’s expected that Cenntro will produce a minimum of 20,000 vehicles this upcoming year. Additionally, it was announced that there’s a management shakeup at play, with Peter Wang, Cenntro’s chairman and CEO, taking the reins of the combined entity. Moving forward, Naked Brand will be operating under a new name: Cenntro Electric Group Limited.
In some ways, this pivot could be viewed as a big positive. There’s still a tremendous amount of growth potential in the EV market. And given some of the valuations in this sector, perhaps NAKD stock is one with some serious upside potential.
That said, this is a big move away from Naked’s current business. Some investors may still be wary of what this strategic shift will mean for their investment. Fair enough.
Where this stock goes from here remains to be seen. However, it will undoubtedly be a fun one to follow in 2022.
On the date of publication, Chris MacDonald 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.