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On Monday, Lordstown Motors stated that they will start customer deliveries in Q1 2022. RIDE stock is up.
Lordstown Motors Corp (NASDAQ: RIDE) stock rose by as much as 15% during Tuesday’s afternoon trading session before closing at $10.31 per share, up 11.34%. This came after the newly appointed chairwoman, Angela Strand, guaranteed the company’s limited production of its Endurance electric pickups in late September. She also confirmed sufficiency in Lordstown’s funding, saying it will drive it through May 2022.
Previously, the company had raised bankruptcy concerns after casting what it called “substantial doubt” on its operability in the coming year. Moreover, Hindenburg Research produced a report of the company in March, and it contained strong accusations citing the company’s pre-orders to be “fake”. There were issues with the seriousness of certain orders and the persons the company claims had made those orders. Pre-order numbers were fabricated to mislead investors into raising more capital for business, the report claimed.
The short seller also stated that production of the Endurance pickup was years away. However, Lordstown maintained on Monday that they will start customer deliveries in Q1 2022. Shares dropped 18.84% after a board committee conducting an internal investigation confirmed Hindenburg’s allegations. Lordstown however discredited the report stating that it “is, in significant respects, false and misleading.”
Lordstown Motors Stock
Another sore point for the company is the ongoing Securities and Exchange Commission (SEC) investigation to determine the factuality of Hindenburg’s claims. More so, it will look into Lordstown’s IPO through the blank check company DiamondPeak Holdings. News of an SEC filing brought with it a 20% crash in share prices Wednesday.
Strand, however, expressed new hope for Lordstown saying, that “it’s a new day at Lordstown and there are no disruptions, and there will be no disruptions to our day-to-day operations.”
Her declaration comes just a day after the former execs Steve Burns and Julio Rodriguez stepped down as CEO & Chairman, and CFO respectively. Lordstown’s President, Rich Schmidt, maintained that while the internal investigation was not the reason for their resignation, it contributed in part to their sudden departures. The company requires more proficient leadership moving forward, he added.
Strand, the former lead independent director in the company, will continue to be the interim chairwoman and CEO until a permanent person is identified for the position.
Already, events contributing to shares down-pricing have cut down Lordstown stock by half this year. The company has transitioned from being a favorite of Wall Street to becoming the target of short-sellers and financial regulators. Its long-term viability has been questioned, especially with its -31.68% 3-month and -48.60% YTD performance.
In the pre-market, Lordstown stock was exchanging hands at $10.02, down 2.81% over the past 24 hours.