Electric vehicle (EV) stocks, such as Tesla (NASDAQ:TSLA), Rivian (NASDAQ:RIVN), Lucid (NASDAQ:LCID), Mullen Automotive (NASDAQ:MULN) and Nio (NYSE:NIO), are all in the red today. On a general basis, both the S&P 500 and Nasdaq 100 kicked off this week in the red following the events of the Israel-Hamas conflict, which in turn affected these five EV stocks.
It’s worth noting that none of these companies have significant exposure to Israel’s automotive market. According to BNN, Nio is expected to enter the Israel market before the end of the year, although the ongoing conflict could possibly affect this launch date. Tesla is already present in the market.
Additionally, each of these five companies is dealing with its fair share of company-specific news. Over the weekend, the China Passenger Car Association (CPCA) disclosed that sales of China-made Tesla vehicles fell by 10.9% month-over-month (MOM) during September. China-made Tesla vehicles sold for the month totaled 74,073, while sales of the Model 3 and Model Y declined by 12% MOM. As the leader in the EV industry, competitors will likely move in sympathy in response to any Tesla news.
Why Are EV Stocks Down Today?
Shares of RIVN stock are also taking a hit after Wedbush reiterated its “outperform” rating but cuts its price target to $25 from $30. Analyst Dan Ives commented that demand isn’t an issue for the company, although management’s recent moves have resulted in a lower price target. This includes a $1.5 billion convertible debt offering despite third-quarter production coming ahead of analyst estimates.
“While we maintain our Outperform rating and remain positive on the name, one more big misstep like this convert offering would be the final straw that broke the camel’s back for many bulls including ourselves.”
In other news, Lucid is forecasted to burn through $338,000 for every vehicle it sells this year, according to Bloomberg Intelligence. The company has struggled to ramp up sales and production in light of previous challenges, such as rising battery costs and supply chain inefficiencies.
Finally, Mullen announced this morning that it had received a non-compliance notice from Nasdaq. The company held its annual meeting on Aug. 3, but failed to allow shareholders to discuss company affairs with management. As a result, it did not meet Nasdaq’s annual meeting standards. Mullen has stated that it will present to Nasdaq a plan to regain compliance.
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.
