What happened 

Shares of Eos Energy Enterprises (NASDAQ:EOSE) plunged as much as 21.6% in trading Thursday after a short-seller report came out. Shares closed down 13.6% on the day. 

So what

Iceberg Research released a report headlined "Fake Customers Won't Recharge a Dead Battery." It accuses Eos of having a questionably large order book that grew right before its merger with a special purpose acquisition company (SPAC). 

Energy storage assets in front of a wind farm.

Image source: Getty Images.

It also raises technical questions about the company's zinc-based battery technology that has worse efficiency than traditional lithium-ion batteries. Based on Iceberg's analysis, the stock has a 90% downside from its current price.

Now what

Short-sellers have a motivation behind releasing reports like this: They want to get their investment thesis out and begin to push the stock lower. That's exactly what has happened today. 

Some of the points brought up in the report are valid, but it'll take time for either a bullish or bearish thesis to play out for this renewable energy stock. I wouldn't sell on this report alone, but keep in mind the short thesis if you own this stock because understanding both sides of an investment is important for investors. 

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.