Electric vehicle (EV) stocks received a significant boost recently when Volkswagen announced a $5 billion investment in Rivian. This news caused a surge in many EV stocks, including Rivian, which is now poised to reclaim its position as a leader in the EV sector. However, not all EV stocks are good buys, and some companies have troubling fundamentals.
Fisker, for example, has been on a rollercoaster ride since losing its spot on the New York Stock Exchange. Despite brief spikes in stock price, the company defaulted on a loan and filed for bankruptcy, with little hope for recovery. Faraday Future, another troubled EV stock, has shown some stability but lacks real growth prospects. The company has accumulated significant losses and is running out of cash.
Canoo, a struggling EV penny stock, has seen a steep decline in its share price, falling more than 80% year-to-date. The company reported poor first-quarter earnings and is unlikely to see any significant growth in the near future. Overall, while some EV stocks are benefiting from sector-wide momentum, investors should be cautious and avoid companies with unstable fundamentals.