What happened

Many growth stocks and speculative names in the electric vehicle (EV) sector have been pummeled as the Nasdaq Composite index ventured into correction territory to start this year. But investors are buying back in today, and speculative stocks in the EV sector like Workhorse Group (WKHS -11.75%) are outperforming. After spiking as much as 11.4% early Wednesday, shares of the electric delivery vehicle builder were still up 9.3% as of 11:33 a.m. ET today.

So what

Today's upward move in the Nasdaq comes after some solid earnings reports from big tech names like Microsoft, and as investors look forward to the fourth-quarter and full-year 2021 report from Tesla after the market closes today.

But the jump in Workhorse stock doesn't make up for the nearly 50% drop that shareholders have endured over the last three months. That slide came as operational issues have hampered the company's growth plans. Whether it can recover from those problems will likely determine if the stock can make a sustainable comeback. 

concerned investor looking at dropping stock chart on laptop computer.

Image source: Getty Images.

Now what

While Workhorse has been a speculative investment from the start, investors lost much confidence when the maker of last-mile electric delivery vehicles said in September 2021 that it had suspended deliveries of its C-1000 electric commercial delivery vans. Workhorse also recalled 41 vehicles at that time that it had already delivered to customers.

The company said it needed to modify its vehicle design to certify the C-1000 under Federal Motor Vehicle Safety Standards. In its third-quarter financial update in November, management said it was continuing testing "with plans for future reconfiguration."

No update has been provided since then, and the stock has continued to drift downward. Today's jump in shares should be looked at as market noise. The spike today really only reflects how far the stock has dropped, and is a reaction to the general market move back into tech names today. Workhorse's business still has many more questions to answer before it could become a viable investment from here.