Oh nicola, i have purposely avoided making a video on the stock because well i thought the company was kind of sketchy. My entire goal with this channel is to help you make better stock market decisions, so i didn't really want to pitch subpar ideas. Nicola came into the limelight at the start of this summer, but it typed that out pretty quickly. Recently, though, there were some announcements related to the company, and people have been asking me my thoughts on what's going on, so i thought i would address it in this.

Quick video, what is going on moon gang, i hope you're having a great day. My name is matt and in this video i will be discussing nicola it's recent news and why i will not be investing in the company before all of you in the bull camp. Get pissy and exit the video because i'm not supporting your bias. I ask that you just hear me out if you're interested in this type of stock market related content and want to be a member of an awesome community.

Join the moon gang by hitting the subscribe button. It would also be greatly appreciated if you could hit the like button, because it really helps with getting this video in front of other people. Alrighty, then, now that we got that out of the way, let's get started as a quick recap, nikola is another electric vehicle company and their differentiator is that they use - or, i should say, are planning on using hydrogen fuel cells, as you can see from their website. Here their business has three main divisions: motor energy and power sports, but with that being said, nikola's main product is these large ev trucks they're currently working on five different ones and i'll make sure to speak specifically about the nikola badger later in this video nikola trades Under the stock ticker nkla and he came onto the scene june 4th of 2020 after a reverse merger with the special acquisition company vecto iq, this daily chart does a good job at showing you why everyone was talking about nicola at the start of the summer.

The stock quickly shot from 36 dollars all the way up to 94 and then came tumbling down when people realized that nicola had no revenue, and on top of that, didn't even really have a product, i'm all about potential, but this is an absurd run almost instantaneously. The company was hit with scrutiny. This was from cnbc meet nikola the speculative electric vehicle stock. That traders believe is as valuable as ford and business insider, followed up by saying.

Nikola motors, a tesla competitor with zero revenue is worth 23 billion dollars. This is exactly why i stayed away from the company. It made absolutely no sense to me that a company could be worth so much without having sold a single thing now at the time that i'm making this video nicola is no longer more valuable than ford ford. Currently has a market cap of roughly 28 billion and nicola is half of that at 14 billion.

That's, obviously a big drop, but nikola is still worth 14 billion dollars and they haven't sold a thing and have no plans to do so in the year 2020.. So that was all at the start of the summer, but people quickly forgot about nicola. It came back into our lives in early september. With this big green day on september 8th, it was reported that general motors took an 11 stake in nicola, which prompted nicolas stock to rally over 50 percent.

This 11 equity is equivalent to 2 billion and, under the partnership, gm will produce nicola's electric pickup truck the badger by the end of 2022.. Many analysts viewed this partnership as a last-ditch attempt by gm to be competitive with tesla, but gm's world was rocked just two days later. On september 10th, the headlines read short seller hindenburg alleges that electric truck maker nicola is an intricate fraud and nicola plummets, 13. After short-sale report alleges years of deception and false statements by ceo, the timing of this is no coincidence.

The people at hindenburg research are trying to drive nikola into the ground by proving that their ceo is a fraud and i'm sure that gm is not happy in the slightest when the gm partnership news was released, nicholas stock quickly shot up from 35. All the way up to 54 and then when the short seller report came out, all those gains were quickly erased. The entire report can be found on hindenburg's website, i'm not going to dissect it in this video because it's very long and detailed, but i would highly recommend reading it because it has convinced me to not invest in nicola, even if you disregard the alleged fraud. I still wouldn't invest in nicola because they don't have a superior product compared to both hylion and tesla.

Nicholas trucks are behind in development and when they are developed, they're going to cost more money and what's worse than that, they're considerably more expensive than diesel trucks. And to make matters worse, nikola's decision to go with hydrogen fuel cells might not have been the best option. The fuel is more costly, there's less existing infrastructure, and the carbon footprint isn't helped that much so, if nicola is losing in all three of these categories and they're behind in development, it makes you wonder what does it have going for it overall. I personally think that the risk to reward ratio of nicola is not worth it.

It doesn't really match my trading or investing style, but obviously you can do whatever you want with your own money, but i personally think that companies such as tesla, hylion and workhorse are all better investments with. That being said, i would still love to know your opinions in a comment below thanks for watching to this point in the video. I truly appreciate your support. If you have any suggestions or recommendations feel free to, let me know, i promise to respond to all of you if you found any value or enjoyment in this video.

Let me know by hitting the like button and if you want to join the moon gang subscribe to the channel and don't forget to turn on your notifications, thanks for watching and until next time best of luck in the markets.