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Why Is Polestar (PSNY) Stock Heating Up Today?

  • Polestar (PSNY) stock is climbing slightly after the company reaffirmed its 2022 production guidance.
  • It expects to deliver more than double the number of electric vehicles this quarter compared to Q3.
  • The automaker plans to launch its first SUV next week.
PSNY stock - Why Is Polestar (PSNY) Stock Heating Up Today?

Source: Robert Way / Shutterstock.com

Polestar (NASDAQ:PSNY) stock is climbing in early trading after the electric vehicle (EV) maker reaffirmed its 2022 delivery guidance. Specifically, it continues to expect to deliver 50,000 EVs in 2022.

Last quarter, Polestar delivered about 9,215 EVs, roughly 100% higher than the number it provided in the third quarter of 2021. During the current quarter, Polestar expects to deliver more than double the number of EVs it unloaded in Q3. The company explained it has been able to step up its production in China in recent months.

“We needed to catch up on production after Covid-19 related setbacks in China and we have,” Polestar CEO Thomas Ingenlath said in a statement. “The majority of Polestar 2 cars set for delivery in Q4 are ready and making their way to our customers in 27 markets around the world, with the fourth quarter set to be our strongest on record yet.”

Investors are trying to determine if, despite the supply chain issues all automakers are encountering, EV startups like Polestar will be able to meet their production guidance.

Upcoming SUV Launch

Next Wednesday, Oct. 12, Polestar will unveil its first SUV, the Polestar 3. InvestorPlace Writer William White recently reported the EV will feature “centralized core computing from Nvidia (NASDAQ:NVDA)” and be able to “adapt to different road types once every two milliseconds.” The EV will also be equipped with advanced safety systems made by Polestar’s sister company, Volvo Cars.

Polestar is a joint venture controlled by Volvo and Chinese automaker Geely. The latter company has owned Volvo Cars since 2010.

A Negative View on PSNY Stock

On Sept. 9, research firm Redburn started coverage of Polestar with a “sell” rating. The firm believes that, with many more companies making EVs, Polestar may “struggle to stand out,” particularly outside of Europe. Calling the company’s prices soft, the firm thinks the demand for Polestar’s EVs will not meet its targets.

On the date of publication, Larry Ramer 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.

Larry Ramer has conducted research and written articles on U.S. stocks for 15 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been PLUG, XOM and solar stocks. You can reach him on Stocktwits at @larryramer.

Article printed from InvestorPlace Media, https://investorplace.com/2022/10/why-is-polestar-psny-stock-heating-up-today/.

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