After Nikola finally addresses the most severe accusations it received from Hindenburg Research, the stock market appears to have decided to back it up. At least if you consider the 11.39 percent increase in the company’s shares on September 14, when Nikola released its response. Nikola also got the SEC involved to investigate Hindenburg’s allegations, but that implies that the company is also under probe by the entity – which can be a good thing.
In the video above, Bloomberg Technology mentions sources within the SEC confirmed the commission would verify Nikola’s actions. In other words, if it infringed security laws in any way. The SEC will also check if Hindenburg Research’s report had the objective of devaluating Nikola’s shares as a way to gain from its confessed short-selling position.
The video also mentions that the fact that Nikola is involved with big companies – such as Bosch, CNH Industrial NV (Iveco), and more recently with GM – makes it very difficult to believe that none of them conducted due diligence investigations. Mary Barra herself confirmed that in GM’s case. That is one of the main points in Nikola’s defense against Hindenburg’s accusations.
The video also states that regardless of what the company did in the past – probably referring to the footage in which the Nikola One moves with the help of gravity – it would have made impressive accomplishments.
The first is the partnership with respected companies from all over the world. The second is having plans to sell a battery truck, a fuel-cell truck, and an electric pickup truck. We’d mention the video forgets something that seems crucial to Nikola’s success: the hydrogen refueling stations it promised to establish when its first trucks start to be delivered.
This hydrogen network is probably the most critical thing Nikola is bringing to the table in all these partnerships. If it manages to offer places where FCEVs can top up their hydrogen tanks, it will allow vehicles from other companies to adopt fuel cells. Much like Tesla and its Superchargers, Nikola knows its success depends on the practicality of the vehicles it intends to sell.
That said, the tweet above shows Trevor Milton thinks the SEC scrutiny is positive. If the commission states Nikola did nothing to hurt securities laws, that will be something the company’s CEO will have as a trophy. On the other hand, if it finds any issues, that can be destructive for Nikola. Milton does not seem to be concerned with the latter hypothesis.
Source: Bloomberg Technology