Nikola Goes Into Full Blown Death Spiral After Shares Are Nuked By 28% In One Day

Nikola Corporation is circling the drain, and somehow, that’s not even the most surprising thing about this whole debacle. Shares just nosedived nearly 28% to a meager $0.85 after Bloomberg reported the company is considering selling off parts of itself, or even the whole damn thing. Oof.

(Source: Giphy) 

For those keeping track, Nikola’s been the poster child for SPAC-era dysfunction since it rolled onto the public markets in 2020. Back then, it was all hydrogen dreams and vaporware promises, courtesy of its founder Trevor Milton. Fast forward to today, and Milton’s been convicted of fraud, the company’s been through a revolving door of CEOs, and its battery-electric trucks are literally catching fire—resulting in 209 trucks being pulled off the road because of it. 

Additionally, Nikola’s cash situation is equally tragic. It ended Q3 with $198 million in the bank, which sounds like a lot until you realize they’re burning through it faster than a TikToker spends their first influencer check. CEO Steve Girsky—a former Morgan Stanley analyst who brought Nikola public via SPAC—warned investors back in October that they’ve only got enough gas in the tank to last until Q1 2025. After that? Well, let’s just say the lights might not stay on unless someone swoops in with a big bag of cash or a miracle partnership.

(Source: CNBC) 

Girsky, for his part, is doing his best to keep the sinking ship afloat, telling anyone who will listen that Nikola is “actively talking to lots of potential different partners.” Translation: they’re speed-dialing everyone from legacy automakers to hedge funds, hoping someone sees value in what’s left of this dumpster fire. But even with that—what exactly is there to save? The EV market is oversaturated, Nikola’s tech has been underwhelming at best, and its reputation is so tarnished that not even a rebrand could fix it.

Sure, the company launched on the hype of the SPAC boom, riding the wave of investor FOMO that turned anything remotely EV-related into gold. But hype only gets you so far when your business is built on half-truths and non-existent technology. Nikola wasn’t just a failure—it literally wrote the book on “What Not to Do” for an entire generation of EV startups that thought they could fake it until they made it. 

(Source: Bloomberg) 

Which is why now, Nikola is left with a few bad options. They could sell off parts of the business piecemeal, but that’s like stripping a car for parts when the engine’s already blown. Finding a buyer for the whole company seems even less likely unless someone’s in the market for a fixer-upper with a history of fraud and failure. And raising new funds? Good luck trying to convince investors to light their own money on fire. 

In the end, the writing is on the wall: Nikola’s days as a viable company are numbered. The EV market has moved on, and so have investors. Of course, for anyone who loves living on the edge, the plummeting stock does scream “BTFD”, but honestly—if you like getting rekt, I’d sit this one out. Better safe than sorry even if some miracle comes through. Spoiler: My opinion is not a chance in hell.

(source: Giphy) 

As always, do what you will with this information and place your bets accordingly. Stay safe and stay frosty, friends! Until next time…

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Stocks.News does not hold positions in companies mentioned in the article.