Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why Ideanomics Stock Is Skyrocketing Today

By Chris Neiger - Nov 23, 2020 at 11:26AM

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

Investors pushed the stock astronomically high on the company's latest investment news.

What happened

Shares of Ideanomics ( IDEX -6.76% ) are soaring today after the company announced that it's investing more money into the electric tractor company Solectrac.

The tech stock was up by an eye-popping 87% early today, and settled to a 57.1% gain as of 11:32 a.m. EST.

So what

Ideanomics said in a press release today that the company is making an additional $1.3 million investment in Solectrac. This investment comes on the heels of an initial investment that Ideanomics made in the company at the end of October. 

Light blue arrows on a dark blue background.

Image source: Getty Images.

Ideanomics' original investment gave it a 14.7% stake in Solectrac, and the new investment bumps its ownership in the company up to about 22%, once everything is finalized.

Investors were excited to see the company expand further into this space, likely because Ideanomics estimates that electric tractors will "disrupt the $75 billion global agricultural tractor industry."

Alf Poor, the CEO of Ideanomics, said in the press release, "We believe Solectrac has enormous potential and, given the uptick in both product inquiries and investment interest they are seeing, we exercised our rights to increase our stake so we can help Solectrac scale to meet anticipated market demand."

Now what

A company nabbing a larger stake in another company is significant news. But Ideanomics' announcement doesn't appear to justify the meteoric rise of its stock price today. The stock has taken some wild swings over the past year (and over the past several years, for that matter), and today's massive jump should be more of a warning sign for some investors, rather than cause for celebration. Just as it did last week, this stock appears to move on simple press releases.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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

Ideanomics, Inc. Stock Quote
Ideanomics, Inc.
$1.38 (-6.76%) $0.10

*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 service.

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 12/03/2021.

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

Our Most Popular Articles

Premium Investing Services

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