EV stocks are taking a beating today. Investors appear to be spooked by the recent surge in bond yields, which today surged to 1.75%, the highest level in 14 months. Various EV growth stocks have understandably seen valuations take a hit, as bonds continue to sell off and investors price in higher inflation expectations.
Aside from these broader risks the market is pricing in today, Lordstown Motors (NASDAQ:RIDE), Workhorse Group (NASDAQ:WKHS), and Nikola (NADSAQ:NKLA) are all down on company-specific risks as well.
Let’s take a look at what’s driving these stocks lower today.
EV Stock No. 1: Lordstown Motors
Investors in RIDE stock have seen a sharp drop today of more than 12% at the time of writing. This appears to be mainly due to the company’s disclosure yesterday that the SEC is probing the company for misleading investors.
This came as Hindenburg Research put RIDE stock in its cross-hairs this past week. A March 12 short report alleges “that the company’s orders are largely fictitious and used as a prop to raise capital and confer legitimacy.” Hindenburg believes the company is 3-4 years away from actual production, and this is a stock that has simply ridden the wave of hysteria in this sector to its current valuation.
EV Stock No. 2: Workhorse Group
Today’s drop of more than 7% at the time of writing in WKHS stock appears to be more simplistic. Workhorse has a 10% stake in Lordstown, meaning these stocks tend to trade in sync, for better or worse.
Additionally, aforementioned bearishness in the sector overall appears to be a key driving factor taking most EV stocks down by at least this percentage today.
EV Stock No. 3: Nikola
Investors in NKLA stock have seen a 9% drop today on an interesting report that an early investor was selling its stake. The hydrogen fuel cell EV company has also been under pressure as earlier this week, the company reportedly in a regulatory filing it’s looking at pursuing an additional equity raise.
Short-seller Hindenburg Research has also hammered NKLA stock, publishing a scathing report alleging fraud.
These factors have combined for a bearish soup today for Nikola and its peers.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article.
