What’s going on with Arrival (NASDAQ:ARVL)? Shares of the electric vehicle (EV) company closed higher by over 110% yesterday on no company-specific news. In fact, Arrival’s last investor relations update was released on Nov. 24, detailing the appointment of Peter Cuneo as interim CEO. The company’s last Securities and Exchange Commission (SEC) filing was related to an institutional investor lowering its stake by two million shares. Shares of ARVL stock are up by more than 15% today.
Meanwhile, ARVL had a short interest as a percentage of float of 22.85% as of Dec. 30. That’s equivalent to 52.56 million shares shorted and is high enough to drive a short squeeze.
The company’s third-quarter earnings may help to explain the high short interest. During Q3, Arrival reported a net loss of $310.3 million, up from a loss of $30.6 million year-over-year (YOY). Revenue tallied in at zero dollars.
As of Sept. 30, cash and cash equivalents totaled approximately $330 million. The company forecasted a cash balance of between $160 and $200 million for the end of the year. This cash is expected to fund the company until Q3 of this year.
Furthermore, the company currently has a focus on the U.S. market, explaining:
“Limited resources and the attractive opportunities of the U.S. market makes developing U.S. products the best use of capital, but this means revenues and margins will come later; not in 2023.”
5 Investors Betting Big on ARVL Stock
Tracking institutional ownership is important, as these large investors provide liquidity and support for stocks. During Q3, 81 13F filers owned a position in ARVL, marking a decline of 10 filers compared to Q2. Meanwhile, the institutional put/call ratio sits at 2.55, up from 0.97. That’s equivalent to 9.02 million puts and 3.54 million calls, implying an extremely bearish options stance. With that in mind, let’s take a look at the top shareholders of Arrival:
- Kinetik S.A.R.L.: 402.12 million shares. Kinetik reported selling two million shares in an amended Schedule 13D dated Dec. 21.
- Wellington Management Group: 26.45 million shares. Wellington sold 3.95 million shares during Q3.
- Millennium Management: 5.35 million shares. Millennium sold 170,389 shares during Q3.
- Two Sigma Investments: 3.39 million shares. Two Sigma sold 143,499 shares during Q3.
- BlackRock (NYSE:BLK): 3.25 million shares. BlackRock purchased 233,354 shares during Q3.
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On the date of publication, Eddie Pan did not hold (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.
