Investors Are Betting on a Short Squeeze in QuantumScape (QS) Stock


  • QuantumScape (QS) is trending on social media, rallying over the past 24 hours.
  • QS stock is surging after Toyota (TM) decided to prioritize the development of solid-state batteries.
  • However, QuantumScape may face a great deal of competition if and when it finally commercializes its batteries.
The entrance to QuantumScape Headquarters QS stock
Source: Tada Images /

Battery maker QuantumScape (NYSE:QS) has been one of the most popular stocks on social media over the last 24 hours. Yesterday, shares of QS stock jumped 14%. Now the stock is climbing another 1% in early trading today.

Why is QuantumScape on the rise? This battery company’s shares are rallying after the Associated Press reported that Toyota (NYSE:TM) is looking to develop a solid-state battery. Founded back in 2010, QuantumScape has been seeking to create such a battery for 13 years.

Meanwhile, some investors believe that QS stock could undergo a short squeeze. About 20% of the stock’s float is being sold short, according to data provided by Fintel.

QS Stock and Toyota’s Initiative

Toyota intends to begin utilizing solid-state batteries “as soon as 2027.” The automotive giant believes that, with such batteries, the amount of time drivers will need to wait before their electric vehicles (EVs) are fully charged will sink to “10 minutes or less.”

In QuantumScape’s first-quarter shareholder letter issued on April 26, the company stated that tests of its prototype battery cells showed that “most cells performed very well.” The company reported, “[W]e have work to do to improve reliability as we transition from prototype to commercial product.”

According to Seeking Alpha in an April 27 article, however, QuantumScape has to increase the capacity of its batteries’ cathodes and reduce “the thickness of cell stack elements [while] minimizing inactive materials.”

QuantumScape’s Outlook

Importantly, QuantumScape reportedly “hopes to be close to commercialization” of its batteries by late 2025, although that timeline is not definite. As a result, its solid-state batteries may have to compete with the likes of Toyota.

Meanwhile, BMW (OTCMKTS:BMWYY) plans to start researching prototypes of Solid Power’s (NASDAQ:SLDP) solid-state batteries. Vietnamese EV maker VinFast has committed to incorporating Israeli startup StoreDot’s “‘extreme fast charging (XFC) battery cells’ into EVs that it will sell to consumers in 2025.” Finally, both Samsung and Panasonic (OTCMKTS:PCRFY) are developing brand new, better batteries as well.

Taken together, this information suggests that QS could get beaten to the punch by the competition.

On the date of publication, Larry Ramer 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 Publishing Guidelines.

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