The electric truck maker's stock resumed its decent on Thursday after influential Wedbush Securities analyst Daniel Ives downgraded his rating on the stock to sell on recent questions over Nikola’s technology and business model, and what he called a “dark cloud” from Tesla’s (TSLA) - Get Report “Battery Day” reveal.
Shares of Phoenix-based Nikola plunged on Wednesday after The Wall Street Journal reported that ongoing discussions between Nikola and major energy companies including BP (BP) - Get Report are on hold following a recent damning short-seller’s report that alleged the company misled investors. Milton stepped down as CEO last week.
Nikola stock was down another 20% at $16.96 in early trading Thursday, extending Wednesday’s 26% drop, following Ives's report, which noted the Nikola story has changed with recent allegations of fraud, the stepping down of CEO Trevor Milton and "serious concerns” over the execution and timing of its “ambitious goals.”
Recent questions surrounding the Nikola story "raised by the bears will be a dark cloud over the stock until answered," he said, adding that "eye popping battery innovations" from Tesla announced this week including a cheaper, lower-cost battery "throws a wrench" in Nikola's return on investment story around hydrogen fuel cell vehicles.
On Sept. 10, New York-based Hindenburg Research 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.