If you’re looking for the biggest gainer in today’s pre-market, look no further than Electra Meccanica Vehicles Corp (NASDAQ: SOLO). The company announced pre-orders of its vehicles, seeing incredible growth. As you would imagine, the news excited investors, pushing the stock on a run for the top. Today, we’ll talk about:
- The pre-orders announcement;
- what we’re seeing from SOLO as a result; and
- what we’ll be watching for with regard to the stock ahead.
SOLO Rockets On Pre-Orders
As mentioned above, Electra Ceccanica Vehicles is having a great start to the trading session, becoming one of the biggest gains in the pre-market this morning. The gains are ultimately the result of a press release issued early this morning surrounding pre-orders of the company’s vehicles.
In the release, SOLO said that as of October 22, 2018, it had a total of 64,154 pre-orders across all vehicle models. The company said that 23,030 of these pre-orders surrounded its single-passenger electric vehicle with a price of $15,500. 41,124 of the pre-orders come from the Tofino two-seat roadster sports car. This vehicle has a target MSRP of $50,000.
Each of these pre-orders came with a deposit. For the SOLO one seater, the deposit was $250 and for the Tofino, the deposit was $1,000. Also, dealer pre-orders require a letter of credit or letters of interest and all orders are non-binding.
The orders themselves were positive news. However, there’s more to the gain than meets the eye. Before the announcement, Electra Ceccanica Vehicles was trading flat with a low float and high short interest. So, when the positive news caused the stock to edge upward, it also caused a short squeeze that is leading to gains in multiples.
In a statement, Jerry Kroll, CEO at SOLO, had the following to offer:
I am pleased to update our investors on the strong pre-order demand we have seen for our innovative electric vehicles. These orders represent $2.4 billion in potential sales at the expected vehicle MSRPs, presenting a large market for us to address as we scale vehicle production with our strategic manufacturing partner.
We continue to see a significant opportunity for the SOLO not only with individual commuters, but in commercial applications as well. To that end, we are currently working with 7-Eleven, the world’s largest convenience retailer, to evaluate our vehicles for use in local package delivery applications.
We are focused on delivering an exhilarating yet affordable electric vehicle experience to consumers and businesses nationwide. We remain on track to deliver our first production vehicles to our loyal pre-order customers at our new Los Angeles dealership in the fourth quarter of 2018, with an expectation of delivering a further 5,000 vehicles over the course of 2019. We are on the cusp of achieving our vision and I believe we are well-positioned to build shareholder value over the long-term. I look forward to providing investors with further updates on our developing story as appropriate.
What We’re Seeing From The Stock
One of the first things that we learn when we start to work in the market is that it’s important to watch the news. After all, the news tends to lead to moves in the market. With the pre-orders showing incredible interest in the company’s vehicles, it comes as no surprise to see that Electra Ceccanica Vehicles is climbing as investor excitement ensues. Of course, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:08), SOLO is trading at $6.00 per share after a gain of $3.83 per share or 175.23% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on SOLO. In particular, we’re interested in following the short squeeze to see just how high the stock goes. We’re also interested in following the company’s ability to fulfill on this large amount of pre-orders and the continued growth in orders. Nonetheless, we’ll keep a close eye on the news and bring it to you as it breaks!
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