Microvast Holdings (NASDAQ: MVST) stock is down 25% yesterday. Usually, a stock price move of this sort of size is accompanied by some actual news which explains why the stock price has moved. Either something that causes the movement - as here with MVST stock - or at least explanations of why it has happened. What’s puzzling here is that there seems to be no such news release. The last we’ve got from the company, for example, is the sale of some insider stock. But that’s just vested stock being sold - possibly for tax reasons - and in a size that wouldn’t cause this sort of reaction.
The basic business line: “Microvast Holdings, Inc. designs, develops, and manufactures battery systems for electric vehicles and energy storage systems in the United States, China, rest of the Asia Pacific, and Europe. The company offers a range of cell chemistries, such as lithium titanate oxide, lithium iron phosphate, and nickel manganese cobalt version 1 and 2. It also designs, develops, and manufactures battery components, such as cathode, anode, electrolyte, and separator.” OK, that’s a good enough business line to be in we would have thought. Certainly, it’s fashionable.
On the other hand, all sorts of EV and battery makers - even miners of the minerals - have been getting into horrible trouble recently. But again, we’d expect an announcement if that were the point here.
Microvast Holdings stock price from Google Finance
This also isn’t something that happened at the close of business last night in thin markets or anything. This happened at the beginning of the day.
Yes, we know there have been problems - the grant of a Federal funds award, the withdrawal when it was pointed out quite how China linked the company is and so on. But again, if this were a repeat of something like that then we’d expect to see the news.
What surprises us is that there is no news story - not that we can see - that even tries to explain this 25% fall. We can see a couple of notes on it, but no one at all pointing to a reason or a why? We do tend to think that the also rans in the battery race aren’t going to do well. But this 25% fall - a $100 million drop in market cap - surprises more for the lack of explanation more than anything else.
One possibility is that something has happened in China and we’re just not being told about it yet. But then that just flags up the risks of investing in China related stocks really.
