What happened
It hasn't been a good start to the year for most electric vehicle (EV) stocks. The downturn in the technology-focused Nasdaq Composite index has helped drive the more speculative and high-risk stocks down sharply. That includes EV makers Lucid Group (LCID 0.12%), Nikola (NKLA 2.02%), and Arrival (ARVL -98.14%). One month into 2022, shares in Lucid, Nikola, and Arrival are down 23%, 16%, and 39%, respectively. But that tide has swung back today, with these names jumping between 5% and 18% this morning.
As of 3:31 p.m. ET, Lucid had given up most of its gains and remained up only 1%, with Nikola and Arrival shares holding gains of 3.7% and 15.3%, respectively.
Image source: Getty Images.
So what
These companies have been pushing forward to advance their underlying businesses in each of their market niches. Today's early jump in the stocks didn't come from any new announcements from the companies. But investors may just have decided the retrenchment in the shares went too far. In fact, Arrival and Nikola have soared off the lows of just four days ago.
Data by YCharts
Now what
Nothing has really changed about these businesses in the last month, let alone four days. Lucid continues to ramp up production of its luxury electric Air sedans. When the company next provides an update, investors will be looking for more insight into whether demand and production continue to grow.
Arrival stock has bounced the most recently, but it is also coming from larger drops after it throttled back its growth and investment plans recently. It will be providing its quarterly financial report to investors on March 2. The company plans to produce electric buses, delivery vans, and cars specifically meant for the ridesharing sector. Its strategy is to utilize smaller, customer-focused microfactories, but it remains to be seen if it can be successful that way.
Nikola has had its own struggles, but it has recently been growing its base of customers who have agreed to accept, and test, its battery- and hydrogen-electric semitrucks. If new users are happy with Nikola's products, its shares could see more growth from here.
But today's stock moves are more just going with the general market sentiment in the high-risk sectors. Investors in these names should be ready to weather more sharp moves, but watching for the upcoming operational and financial updates is what the real focus should be.
