Daily US Times: Tesla and Elon Musk may have some new competition from a company — in the auto market, on social media, and on Wall Street. Nikola, a company that makes battery-powered electric trucks and hydrogen fuel cell just went public.
Over the past few days, Nikola’s stock has more than doubled and the company’s chairman is bragging about it on Twitter.
Shares of Nikola — the first name of the famous inventor Tesla — are up more than 120% since it completed a merger with an already public shell company named VectoIQ on June 3.
On Monday alone, the stock jumped 103%, though it plunged 22% early Tuesday morning in volatile trading along with the broader market before bouncing back. Nikola shares finished the day with a 9% gain.
Tesla shares, which have also skyrocketed lately to a near record high, ended the day down 1%
Monday’s meteoric gains came after Trevor Milton, Nikola founder and executive chairman, issued a series of tweets touting pre-orders for the company’s Badger truck. Shares were up another 27% at the open Tuesday before plummeting.
Nikola began trading under that name last week after its deal with VectoIQ — a special-purpose acquisition company (SPAC) with no assets of its own that was formed purely to merge with a private company seeking to go public.
VectoIQ, which changed its name to Nikola and ticker to NKLA last week following the merger, has already soared more than 600% in 2020 — with most of those gains taking place after Nikola announced plans to buy VectoIQ in March.
Nikola also makes semi trucks and the company is now worth about $26 billion based on Monday’s closing price, even though it’s not expected to generate any sales — let alone profits — until 2021.
This makes the company more valuable than Fiat Chrysler (FCAU) and Ford (F) and it is catching up fast to General Motors (GM) — a fact that Milton boasted about on Twitter on Monday, saying that “‘I’ve wanted to say this my whole adult life; $NKLA is now worth more than Ford and FCA. Nipping on the heels of GM.”
Nikola already has announced sales to big customers, including a multimillion dollar order with freight shipper US Xpress Enterprises (USX) and an 800-truck order from Budweiser brewer Anheuser-Busch InBev (BUD).
The company has also landed some top auto industry talent as it aims to take on Tesla (TSLA), which plans to launch both an electric semi and its futuristic Cybertruck.