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Lordstown will begin production of its Endurance electric truck later this year.
Matthew Hatcher / Bloomberg
Start-up of electric trucks
Lordstown Motors
has a new CEO. Investors reacted with relief.
The company appointed Daniel Ninivaggi as the new CEO on Thursday morning, with immediate effect. Shares of Lordstown (ticker: RIDE) rose 25% to $ 6.88 during early trading. He
S&P 500
down 0.1%. He
Dow Jones industrial average
has increased by 0.2%.
Ninivaggi takes over from board chair Angela Strand, who ran the company after Steve Burns left in June. Burns left shortly after the company received a notice of “continuity” from its auditor. This warning basically means that the company may not have the capital to continue operating without a significant change.
The company is also being investigated by the Securities and Exchange Commission and the Department of Justice over the management of its SPAC merger and the registration of vehicle orders. Pre-orders of vehicles were a problem raised in a negative investigation report by a short seller in March.
Shares in Lordstown reached a 52-week low on 19 August. Shares have risen to bearish and, including Thursday’s earnings, have risen approximately 44% from a low of $ 4.77 per share. Still, shares are down about 80% from a 52-week high of nearly $ 32.
Ninivaggi is the former CEO of
Icahn Enterprises
(IEP) and has served in a “variety of leadership positions in the automotive and transportation industries,” according to the company. His previous work in automotive includes stays at parts suppliers
Lear
(LEA) and Federal-Mogul. He is also a member of the board of directors of
Garrett Motion
(GTX), the turbocharger business
Honeywell International
(SHE).
“I think the demand for full-size electric vans will be strong and the Endurance truck … has a chance to capture a significant market share,” Ninivaggi said. Endurance, Lordstown’s first product, will begin production in the coming months. “I look forward to working with Lordstown’s talented management team, our suppliers and other partners to bring Endurance to market and maximize the value of our assets.”
Ninivaggi will have a hard job. Wall Street has aggravated Lordstown shares. Only one in eight analysts, or 13%, value buying stocks. The average purchase rating ratio for small-cap stocks is approximately 60%. In addition, 50% value sales shares. The average target price of analysts with a sales valuation is about $ 1.55 per share.
Write to Al Root at [email protected]