- Lordstown Motors extended its two-day rally to 49% on Tuesday after it announced a factory tour week for interested investors.
- The electric vehicle startup has led a group of electric-vehicle stocks higher since Monday as the sector sees renewed interest from investors.
- But despite the rally, shares of Lordstown Motors are still down 69% from their mid-February high.
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Shares of Lordstown Motors surged as much as 30% on Tuesday, extending their two-day rally to as much as 49%.
The electric-vehicle manufacturer’s stock began to move higher on Monday after it announced a mid-June event for interested customers, analysts, and investors to tour its Ohio factory, view presentations and test drive its electric pick-up truck, the Endurance.
Lordstown Motors said it plans to begin producing “early production units” of the endurance in late September of this year.
Lordstown Motors isn’t the only EV startup stock rally this week. The sector, which has seen a number of companies go public via “blank-check” mergers over the past year, has picked up renewed interest from investors after suffering sizable drawdowns since the sector peaked in February.
Since the EV sector peaked in February, shares of Lordstown Motors, Fisker, Nikola, and Canoo are down as much as 69%, 61%, 55%, and 60%, respectively.
While some investors may be looking to buy these depressed stocks at a discount to their recent peaks, caution is warranted, as the businesses are still in startup mode and are not yet selling, let alone producing, cars.
And more bad news could be coming for the sector. Take Canoo for example, which disclosed on Monday that it is under investigation by the Securities and Exchange Commission. The EV startup went public via a SPAC merger late last year, and it received a multi-billion dollar valuation on in-part hype of a potential deal with Hyundai.
But within just a few months since going public, Canoo has overhauled its entire business strategy, indicated that there will be no deal with Hyundai, and replaced its CEO.
While there are many startup EV companies looking to take Tesla head on, they are still years away from being considered a threat to Elon Musk’s EV empire.