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Summary
- Stocks of Nikola Corporation slumped almost 27 per cent on Monday, November 30.
- The decline in Nikola’s stock price came after General Motors scrapped its plans to purchase an equity stake in Nikola.
- Tesla stocks dwindled about three per cent on Monday.
The electric vehicle (EV) stocks rally that had taken stock markets by storm this year seems to have hit the brakes. Stocks of Nikola Corporation (NASDAQ: NKLA, NKLA:US) slumped almost 27 per cent intraday, while Tesla Inc (NASDAQ: TSLA, TSLA.US) stocks dwindled about three per cent on Monday, November 30.
Stocks of mainstream automakers lost ground amid the pandemic as companies faced operational disruptions, but electric vehicle manufacturers registered a steady increase in their market share across North America. The EV stock rally gained further momentum in November after the S&P Dow Jones Indices announced Tesla Inc’s inclusion to the S&P 500 Index in December.
Let’s analyze the profiles of Nikola Corporation and Tesla Inc to understand the latest slump in their stock prices:
Nikola Corporation (NASDAQ: NKLA, NKLA: US)
Current Stock Price: US$ 20.41
The decline in Nikola’s stock price came after automaker General Motors Co (NYSE:GM) announced on November 30 that it is scrapping its tentative plans to purchase an equity stake in Nikola. The two companies were supposed to manufacture Nikola’s electric pickup truck named ‘Badger’ in collaboration, plans of which have now been eliminated as well.
Nikola Corporation was also hit with fraud allegations this year. From its highest level this year on June 9, the stock tumbled over 74 per cent in the last five months.
Nikola shares slid 29 per cent in the last six months, but register a year-to-date growth of about 98 per cent.
The stock garnered an average trading volume of 28.7 million in the last 10 days and that of 18.2 million in the past month.
NIKOLA CORPORATION Q3 2020 RESULTS
Nikola Corporation posted total operating expenses of US$ 117.2 million in the third quarter of 2020, up from US$ 13.1 million in Q3 2019.
The company also incurred a net loss of US$ 117.4 million in Q3 2020 ending 30 September 2020, a significant increase from US$ 16.5 million in Q3 2019.
Tesla Inc (NASDAQ: TSLA, TSLA: US)
Current Stock Price: US$ 20.41
Tesla stocks zoomed over 46 per cent in November following on the news of its listing on the S&P 500 Index. Upon hitting a record high on November 19, Tesla became Nasdaq-100 Index’s best performing stock on the for the week.
The surge in Tesla’s stock price saw founder Elon Musk’s net worth rocket to US$ 127.9 billion in late November, pushing him to dethrone Microsoft Corporation co-founder Bill Gates as the second-richest person in the world.
However, Tesla share lost a bit of steam on November 30, most likely in the wake of Nikola’s scrapped deal with General Motors.
Stocks of Tesla Inc shot up over 578 per cent this year and nearly 240 per cent in the last months.
TESLA INC Q3 2020 RESULTS
Tesla Inc reported a total revenue of US$ 8.7 billion in the third quarter of 2020, up 39 per cent year-over-year. Its total gross profit jumped a whopping 73 per cent YoY in Q3 2020, amounting to US$ 2 billion.
Tesla’s cash and cash equivalents stood at US$ 14.5 billion at the end of the third quarter of 2020.
