Please ensure Javascript is enabled for purposes of website accessibility

Why Nikola Stock Is Slumping Today

By John Rosevear - Apr 5, 2021 at 12:12PM

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

Tesla's good news on deliveries wasn't enough to give other EV stocks a boost.

What happened

Shares of electric-truck start-up Nikola (NKLA 6.05%) were trading lower on Monday, as a good deliveries result from Tesla (TSLA 7.33%) failed to reverse a broader slump in electric-vehicle stocks. 

As of 11:45 a.m. EDT, Nikola's shares were down about 6.4% from Friday's closing price. 

So what

There was no major news driving Nikola's shares lower on Monday. I think the decline is best seen in the context of what has been happening to electric-truck stocks, and the electric-vehicle category in general, since about the beginning of February. 

NKLA Chart

NKLA data by YCharts

As you can see, Nikola's stock price has had a rough couple of months, but it's not alone. Investor enthusiasm for emerging companies in the electric-truck space has been fading as legacy vehicle makers with far greater resources gear up to launch electric trucks and commercial vehicles of their own. 

A Nikola Tre, a Class 7 electric semi, shown pulling a trailer on a highway.

Nikola is currently testing prototypes of its Tre electric semi. It hopes to begin production of the truck by the end of September. Image source: Nikola.

Now what

Broadly speaking, the smaller electric-vehicle companies' stocks tend to follow category leader Tesla's gyrations, but that wasn't happening on Monday. While Tesla shares were up on a better-than-expected deliveries total for the first quarter, the news didn't do much for Nikola or most of the other companies in the cohort. 

With no near-term catalysts for the stock on the horizon, investors may have to wait to see how well Nikola executes on its effort to get its Tre electric semi into production over the next several months. 

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

Nikola Corporation Stock Quote
Nikola Corporation
NKLA
$7.19 (6.05%) $0.41
Tesla, Inc. Stock Quote
Tesla, Inc.
TSLA
$759.63 (7.33%) $51.90

*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
356%
 
S&P 500 Returns
124%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/29/2022.

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.