Electric-truck makers Nikola (NKLA) - Get Nikola Corp. Report and Lordstown Motors (RIDE) - Get LORDSTOWN MOTORS CORP. Report were both under pressure Thursday as a corporate backer in Nikola reduced its stake and Lordstown revealed it was being probed by the Securities and Exchange Commission.
Lordstown reported a wider fourth-quarter loss Wednesday and also disclosed that the SEC was seeking information regarding a highly critical report on the company by short-seller Hindenburg Research - the same firm that slammed Nikola last fall.
South Korea’s Hanwha Group, meanwhile, intends to sell half its stake in Nikola, electric-truck maker. An SEC filing dated Tuesday said Hanwha plans to sell about 11 million shares of Nikola, worth about $180 million based on Wednesday’s closing price of $16.39 a share.
At last check, shares of Nikola were down 6.41% at $15.31, while shares of Lordstown were down 9.77% at $13.62.
Nikola has been swirling in controversy since last fall, when Hindenburg released a research report calling Nikola an "intricate fraud" and outlining what it said were instances of the company allegedly misrepresenting its technology and its progress toward developing its trucks.
The bombshell report came just two days after Nikola announced a blockbuster $2 billion deal with General Motors (GM) - Get General Motors Company (GM) Report - a deal that has since been scaled back dramatically. It also prompted the resignation of Nikola founder Trevor Milton.
Ohio-based Lordstown, meantime, kicked off its first-ever call with investors as a publicly traded company on Wednesday by announcing it was being probed by the SEC – also because of allegations by activist short-seller Hindenburg.
Hindenburg has claimed that Lordstown has been faking orders for its Endurance electric truck, and that the truck is actually three or more years away from production.
On Feb. 1, Ives raised his rating on Nikola from underperform to neutral and his price target to $25 from $15, saying he believed most of the negative issues it had faced were now behind it.
Meantime, Tesla (TSLA) - Get Tesla Inc Report continues to chug along its path of being not only an electric vehicle maker, but a technology company. Tesla CEO Elon Musk took that to a new level this week, formally adding "Technoking" to his official title.
Tesla shares were down 3.43% at $677.75.