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Why Fisker Stock Jumped Today

By Howard Smith - Mar 2, 2021 at 10:51AM

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The electric-vehicle company is getting more attention from retail investors.

What happened

Shares of electric-vehicle company Fisker (FSR 2.38%) are making up for Monday's 4% drop today as the name trends on Reddit's WallStreetBets online community. As of 10:40 a.m. EST, shares of Fisker were 12.7% higher than Monday's close. 

So what

The stock dropped yesterday after a report that the company had abandoned plans to develop a solid-state battery that it had previously said would give its vehicles a 500-mile range and a quick recharge. 

But investors, or traders, are moving shares up today, as Fisker joins the list of heavily shorted stocks being discussed on the WallStreetBets forum. Fisker had about 10% of its shares held short as of mid-February, according to MarketWatch.

Fisker Ocean electric SUV outside coastal home

Fisker Ocean electric SUV. Image source: Fisker.

Now what

Fisker is not planning on manufacturing its own vehicles. Its all-electric Ocean SUV is scheduled to begin production in the fourth quarter of 2022. The Ocean will be a Fisker brand initially built in Europe by manufacturing partner Magna (MGA 3.75%). The Ocean will use a modified version of a Magna-developed EV platform. 

The company has also recently announced a new partnership with technology company Foxconn -- also known as Hon Hai Precision (HNHPF 1.57%) -- with plans for Foxconn to manufacture up to 250,000 electric vehicles annually under the Fisker brand.

Long-term investors that believe in the technology and business plan may have good reason to own the stock, but today it seems traders, not investors, are moving it.

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Stocks Mentioned

Fisker, Inc. Stock Quote
Fisker, Inc.
FSR
$11.40 (2.38%) $0.27
Magna International Inc. Stock Quote
Magna International Inc.
MGA
$63.84 (3.75%) $2.31
Hon Hai Precision Industry Co., Ltd. Stock Quote
Hon Hai Precision Industry Co., Ltd.
HNHPF
$7.14 (1.57%) $0.11

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

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