Please ensure Javascript is enabled for purposes of website accessibility

Why Kandi Technologies Stock Fell 11.7% in March

By Keith Noonan - Apr 5, 2021 at 8:47AM

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 EV stock has seen volatile swings, but it's still up 165% over the last year.

What happened

Shares of Kandi Technologies Group (KNDI -0.86%) dipped 11.7% in March, according to data from S&P Global Market Intelligence. The Chinese electric vehicle (EV) company announced new product lines in the month, but it sold off in conjunction with a broader pullback of valuations for companies in the EV space. 

KNDI Chart

KNDI data by YCharts

EV stocks have posted incredible gains in recent years, and some companies have been rapidly scaling their businesses, but market enthusiasm for the space wavered in March. Kandi published its full-year results near the end of the month, with sales and earnings falling short of Wall Street's targets, but the company's share price ticked up following the release thanks to encouraging guidance. 

A Kandi Technologies electric vehicle.

Image source: Kandi Technologies.

So what

Kandi's U.S. division issued a press release on March 17 announcing the availability of its neighborhood electric vehicles (NEVs) -- cars designed for short trips that are usually a supplemental vehicle for most households. The company's Kandi NEV K23 and NEV K27 models became available for order the same day as the press release and were priced at $22,499 and $15,499, respectively. Kandi also announced on March 24 that it would be moving into the powersports market with upcoming lines of ATVs and bikes. 

Kandi then published its fiscal-year results on March 30, posting a loss per share of $0.19 on revenue of $76.92 million in the period. The average analyst estimate had guided for a loss per share of $0.06 on sales of $77.6 million. Sales were down 43.3% compared to fiscal 2019, with a steep drop-off for the company's EV parts segment accounting for most of the decline. 

Now what

Kandi Technologies stock has regained some ground early in April's trading. The company's share price has risen roughly 3.8% in the month so far. 

KNDI Chart

KNDI data by YCharts

Kandi Technologies has a market capitalization of roughly $489 million and is valued at approximately 3.6 times this year's expected sales.

With revenue declining substantially over the last year, it shouldn't come as a surprise that the company trades at much lower price-to-sales multiples compared to other players in the EV space. However, the company's outlook remains speculative, and investors shouldn't take the company's low P/S values as an indication that Kandi is a low-risk stock. 

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

Kandi Technologies Group, Inc. Stock Quote
Kandi Technologies Group, Inc.
KNDI
$2.31 (-0.86%) $0.02

*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
345%
 
S&P 500 Returns
119%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/16/2022.

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.