Please ensure Javascript is enabled for purposes of website accessibility

Why Blink Charging Stock Got Zapped Again

By John Rosevear – Aug 21, 2020 at 11:39AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The company's initial response to a short-seller's allegations didn't satisfy investors.

What happened

Shares of electric-vehicle charging network Blink Charging (BLNK -5.58%) were down sharply again in early trading on Friday. Blink's stock began sliding on Wednesday morning, when a short-selling firm released a blistering note alleging that the company has exaggerated the size of its network. 

As of 11 a.m. EDT, Blink's shares were down about 11.1%. The stock has lost about 25% of its value since the note was published.

One of Blink Charging's public electric-vehicle chargers.

Image source: Blink Charging.

So what

Culper Research revealed on Wednesday that it had opened a short position in Blink's shares after its analysis concluded that Blink's public charging network has just 2,200 operational stations, far fewer than it has claimed. 

Blink has claimed repeatedly, as in this tweet from Monday, that it has "over 15,000 chargers" in its network.

Blink didn't respond to the allegations until Thursday afternoon, when it said in a statement that it had become aware of "false, defamatory, and anonymous reports" that it believes were "intended to manipulate our stock price downward in support of short sellers." 

Apparently that wasn't enough to reassure auto investors, who continued to sell off their Blink shares on Friday morning.

Now what

Given that the stock is down again today, I think Blink needs to say more to reassure its investors. While the company said that it has retained counsel and that it is reporting the "manipulation" to regulators, its short statement didn't address the specific allegations made by Culper on Wednesday.

If nothing else, I think Blink needs to clarify how many public chargers there are in its network, and — if that number is significantly less than 15,000, as Culper alleges — why it felt the need to claim the larger total.

John Rosevear has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Blink Charging Co. Stock Quote
Blink Charging Co.
$18.28 (-5.58%) $-1.08

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/29/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.