3 EV Stocks to Sell on the Brink of Bankruptcy Like Fisker

For the past few weeks, investors have been considering an important question: Is Fisker (OTCMKTS:FSRN) on the brink of collapse?

Fisker stock has been highly volatile since being delisted from the New York Stock Exchange. While positive speculation promoted by dealer partnerships has helped FSRN surge, shares have only fallen back down just as quickly. The company’s CEO has claimed Fisker is currently in talks with several potential buyers, but there has been no word as to whether a deal is moving forward. What’s more, recent reports indicate that production of the Fisker Ocean electric vehicle (EV) has become idle. That has caused Wall Street analysts to also sour on the firm’s manufacturing partner, Magna International (NYSE:MGA).

With that in mind, investors are likely looking for the best EV stocks to sell before they go the way of Fisker. One expert believes that several other EV names may be destined for the same fate. Michael Ashley Schulman, Chief Investment Officer at Running Point Capital Advisors, recently told InvestorPlace about some of the top EV stocks to sell.

EV Stocks to Sell: Mullen Automotive (MULN)

Source: Robert Way / Shutterstock.com

It’s hard to have any faith in this unstable company, a now-classic meme stock that hasn’t displayed much of any actual growth potential in months.

Mullen Automotive (NASDAQ:MULN) recently saw shares pop after the company received approval for California’s Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project (HVIP). But with the company also launching a poison pill plan to prevent a hostile takeover, its future looks increasingly questionable. Schulman noted to InvestorPlace:

“You don’t have to mull over Mullen for very long; they’ve done five reverse stock splits since 2016 with three of them in 2023 […] The company recently announced the production of its 500th electric vehicle and supposedly plans to launch in Europe. But the company has possibly spread itself too thin — across a range of propane/natural gas trucks, EV vans and trucks, and proposed electric passenger cars and sports vehicles — while not innovating enough.”

Schulman also pointed out that Mullen’s attempts to cover costs likely won’t be enough to save the firm from the hole it has dug. Overall, the long list of strikes against MULN stock make a compelling case for why it belongs on a list of EV stocks to sell.

Faraday Future Intelligent Electric (FFIE)

Person holding cellphone with logo of electric vehicle company Faraday Future Inc. (FFIE) on screen in front of business webpage. Focus on phone display. Unmodified photo.

Source: T. Schneider / Shutterstock.com

With a current share price of a little over 4 cents, Faraday Future (NASDAQ:FFIE) is trading just above Fisker stock, but not by much. Not that that’s an achievement. FFIE stock has plunged more than 50% in the past month and almost 100% over the past six months.

Back in February, Faraday announced its second reverse stock split in just five months. This clear sign of distress didn’t help boost shares and, months later, FFIE’s race to the bottom has only accelerated. Now as shares trend ever-lower, it is looking increasingly like the end of the line for this troubled EV stock to sell.

Schulman cited Faraday’s questionable “balance sheet and lack of revenue prospects” as reasons to be wary of FFIE stock. The expert also highlighted the company losing its auditor and its Nasdaq delisting determination last month. Indeed, just about everything seems to be working against this company. With the future looking bleak at best, shares of FFIE seem to be careening toward a cliff.

EV Stocks to Sell: Nikola (NKLA)

Nikola (NKLA) badge on the front of a matte black car

Like other failing EV players, Nikola (NASDAQ:NKLA) is a former meme stock that clearly can’t overcome its troubled past. Since founder and former CEO Trevor Milton received a four-year prison sentence for fraud, NKLA stock has spiraled out of control.

Most recently, shares have fallen due to a significant revenue miss for the first quarter of 2024. But Nikola’s problems go far beyond that. Schulman noted that, like Faraday, “Nikola also has serious issues and lost nearly $1 billion last year.” Even the success of the EV company’s recent capital-raising initiative isn’t likely to save it.

Last month, InvestorPlace contributor Muslim Farooque also reported on Nikola’s lack of growth prosects:

“[Nikola] ended last quarter producing just 35 hydrogen fuel cell electric trucks, posting modest sales of $11 million. Moreover, it had to recall its 209 electric semis due to severe battery flaws. That was compounded by a grim $154 million operating loss in the fourth quarter.”

All told, NKLA looks like yet another one of the top EV stocks to sell.

On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks. 

Read More:Penny Stocks — How to Profit Without Getting Scammed

On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Samuel O’Brient is a Reporter for InvestorPlace, where his work focuses primarily on financial markets, global economic trends, and public policy. O’Brient writes a weekly column on recent political news that investors should be following.

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