Trevor Milton

Summary List Placement

Just days after announcing a big-time deal with General Motors, Nikola last week came under attack from a short seller, Hindenburg Research, who published a wide-ranging litany of allegations under the un-subtle title “How to Parlay An Ocean of Lies Into a Partnership With the Largest Auto OEM in America.”

Hindenburg is Nate Anderson, and as far as I can discern, the firm is a one-man shop; this isn’t exactly Bill Ackman going after Herbalife in 2012, similarly maintaining that the company was a financial fraud (an illegal pyramid scheme, in fact).

In his report, Anderson indicated that Hindenburg had taken a short position in Nikola, which went public earlier this year through a “blank check” SPAC deal and quickly minted a $3.3 billion market capitalization, generating a significant amount of chatter in the auto industry and on Wall Street.

It’s not entirely clear that playing the market is Anderson’s mission; he seems to have adventured in a few hedge funds before co-founding his own, then starting Hindenburg in 2018.

However, Anderson’s research was quickly endorsed by another short-angled research firm, Citron Research, run by Andrew Left, who joined a chorus of Tesla naysayers a few years back before reversing course and turning bullish on the company. Left had already talked Nikola down in June.

GM’s CEO stressed the automaker’s diligence on the deal

According to S3 Analytics, a firm that tracks short-selling, Nikola is now the ninth most shorted stock in the auto and construction sectors; Tesla, after an epic rally that commenced at the beginning of 2020, is No. 1.

GM’s deal with Nikola entails taking a roughly 10% equity stake, worth $2 billion, and becoming in effect a contract manufacturer for Nikola’s forthcoming Badger pickup truck — producing the vehicle both in all-electric …read more

Source:: Business Insider


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