Today, Lightning eMotors (NYSE:ZEV) is certainly motoring along. Indeed, shares of ZEV stock are more than 16% higher at the time of writing on intense investor interest.
Like other electric vehicle (EV) plays, Lightning eMotors provides investors with access to a sector with robust long-term secular growth catalysts. However, there are other factors investors are pricing into this early stage EV stock.
We recently reported on some shocking news with ZEV stock a few weeks back. A Warren Buffett-backed vehicle company has inked a significant partnership with Lightning eMotors. This deal could have a total potential value of around $850 million. The focus of this deal will be on supplying more than 7,500 EV drivetrains for shuttle buses operated by Buffett-owned Forest River.
For any investor, an $850 million commitment is a big deal. For Warren Buffett, perhaps not so much. However, the significance of this deal goes much further than simply dollars and cents for investors looking from the outside in on this stock. Indeed, Warren Buffett has not made many investments in the EV space. While not his first, this sends a strong signal to the market that ZEV stock could be a good one to hone in on.
Besides this news, it’s also come to our attention that ZEV stock is on watch as a potential short squeeze play. Let’s dive into this angle a bit more.
Could ZEV Stock Be the Short-Squeeze Play Investors Have Been Looking For?
As noted in our earlier coverage on short squeeze stocks, Lightning eMotors has made the list. That is, it’s on Fintel’s top weekly list of potential short squeeze targets.
Currently, ZEV stock takes third place on Fintel’s top weekly short squeeze opportunities list. The company’s short percent of float is extremely high. Currently, this number sits at around 35%, a level reserved for stocks the market is extremely bearish on. Given the recent investment made by a Buffett-backed company, investors may think this level of bearishness is un-“Warren”-ted. (See what I did there?)
Additionally, the company’s high borrow fee rate of 87% suggests this is a stock that short-sellers may not be able to hold for a long period of time. Accordingly, this stock’s squeeze potential has been noted by the market today.
On the date of publication, Chris MacDonald 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.
