Earlier this month, little-known electric vehicle company Volcon (NASDAQ:VLCN) opened up preorders for the company’s fully electric utility vehicle. Its Stag utility vehicle certainly raised eyebrows with its payload and towing capacity. However, VLCN stock is once again grabbing investor attention after today’s increase of nearly 40%.
This move comes as Volcon announced some rather impressive preorder numbers. Reportedly, the company has seen “thousands” of preorders come in, exceeding expectations. These preorders currently represent $70 million in revenue.
As Volcon’s CEO Jordan Davis commented, “We made a conservative estimate concerning sales volumes, having worked closely with our sales and marketing team to identify sales targets for 2023. While we felt confident in our ability to reach our pre-order targets, we’ve been pleasantly surprised to find we are achieving those targets at a faster pace than we had planned.”
Today, the market appears to be taking these comments to heart. Let’s dive into what investors may want to make of this news.
Is VLCN Stock a Buy On Preorder Numbers?
Like other EV stocks, Volcon has been hammered this past year. Down more than 85% from its 52-week high, VLCN stock appears to have been grouped into the speculative growth bucket .
That said, this announcement is certainly bullish. The fact that demand has materialized to the degree it has is noteworthy. Any time a company comes out with a press release in such a tone, investors take note. In particular, concerns about discretionary demand are one of the key bearish factors that have been weighing down this stock. With some of these concerns lifted today, perhaps there’s significant room for growth from here.
Now, Volcon still needs to produce and deliver its vehicles. This is a company without revenue that’s burning cash. In this environment, investors don’t seem to be willing to take a shot on such stocks.
That said, Volcon is a company I’ve put on my watch list as a result of this news today. It will be interesting to see how the company executes from here.
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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.