Shares of EHang (NASDAQ:EH) fell 20.1% in March, in accordance with knowledge from S&P Global Market Intelligence. The inventory has been underneath stress since short-selling agency Wolfpack Analysis revealed a skeptical observe on the corporate in February, and it sank decrease final month amid a valuation pullback for the know-how sector extra broadly.
Pleasure surrounding EHang’s initiatives to develop and market autonomous flying taxis and different aerial drones has propelled massive features for the inventory over the previous yr, however the marketplace for these sorts of merchandise continues to be very younger. EHang’s shares had hit an all-time excessive in February, and it is not shocking that its inventory fell as growth-dependent tech shares bought off final month.
EHang’s inventory is up roughly 192% over the past yr, nevertheless it’s additionally down roughly 72% from the lifetime excessive of $129.80 per share it hit in February. The inventory’s rally was reduce quick by Wolfpack Analysis’s bearish report, which alleged that EHang was “an elaborate inventory promotion, constructed on largely fabricated revenues primarily based on sham gross sales contracts with a buyer who seems to us to be extra fascinated about serving to inflate the worth of its funding in EH i.e., pump EH’s inventory value than truly shopping for its merchandise.”
EHang responded by saying that it didn’t imagine that Kunxiang, the shopper in query, had ever held any vital stake within the firm, however Wolfpack’s quick report has had an enduring affect on the corporate’s share value. EHang did have some enterprise information to announce final month, however the current quick report and market stress on know-how equities seem to have been greater elements in its inventory’s efficiency.
EHang revealed a press launch on March 16 saying that it was partnering with Giancarlo Zema Designs Group, an Italian structure agency. Giancarlo Zema can be designing and constructing an eco-sustainable vertiport launch pad in Italy for EHang’s passenger air automobiles and different air mobility automobiles.
EHang’s inventory has continued to maneuver decrease early in April. The corporate’s share value is down roughly 6% within the month to this point.
EHang is scheduled to report fourth-quarter outcomes on April 16. With a extremely speculative outlook, EHang shares are primed for volatility if the inventory market market turns turbulent. Some buyers seem like rotating out of growth-dependent know-how shares in favor of corporations that look safer on a elementary foundation, and that might spell bother for EHang’s inventory. And if the corporate’s autonomous aerial car plans fall delayed, shares might sink additional.
EHang has a market capitalization of roughly $1.85 billion and trades at roughly 21 instances this yr’s anticipated gross sales.
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