Lordstown Motors shorted by Hindenburg research

Yahoo Finance’s Julie Hyman, Myles Udland and Brian Sozzi break down Hindenburg’s report on electric vehicles.

Video Transcript

JULIE HYMAN: Let's take a look at the futures here today, because, of course, we have records for the S&P 500 and the NASDAQ yesterday. Today, though, we are seeing a pullback in those indices, or I should say, excuse me, we saw records in the S&P and the Dow yesterday. The Dow is now up another 1/10 of 1% in terms of the futures here this morning.

But we were watching some interesting movers. And one sector of them helps to explain, at least, why NASDAQ futures are down. I'm talking about electric vehicle makers. There was a fire at a Tesla factory in Fremont, California. And that seems to be putting some pressure on those shares there. It doesn't seem like there was a lot of damage, or at least there were no injuries reported, unclear what the damage might be.

And then there's an EV charging station company called ChargePoint that reported results down year over year. So those shares are trading lower. So got those Tesla shares under pressure, got ChargePoint and some of the others under pressure.

And then, guys, there's the case of Lordstown Motor. And I know we're all reading with a lot of interest this morning, Hindenburg out with a short report on Lordstown. Brian Sozzi, they pulled no punches in this report, basically saying the company's manufacturing orders.

BRIAN SOZZI: Yes, so the headline here, and you're seeing Lordstown shares down close to 20% in the premarket is, Hindenburg noting, quote, Lordstown is an electric vehicle SPAC with no revenue and no sellable product, which we believe has misled investors on both its demand and production capabilities. Now, this is a very lengthy report. I am still going through it.

But in this report, Hindenburg does cite an interview that CEO, Lordstown CEO Steve Burns did on our network February 23 calling out that they have presold 100,000 electric pickup trucks. Now, Hindenburg arguing that point saying that these orders, this order book, consists of, quote, fake or entirely non-binding orders, which we noted I have reached out to Lordstown Motors team for comment on the report. We're still going through it.

But again, this is Hindenburg, Myles, flexing its muscles, the same company that took down Nikola last year and really sent that stock price reeling here and ultimately ousted the founder, Trevor Milton, but here, Lordstown now coming under fire from Hindenburg.

MYLES UDLAND: Yeah, and just on the Hindenburg point, they're very good at the thing they're trying to do, which is create a large reaction, not only in shares, but also create a big headline that people then talk about. And I think an interesting maybe echo boom of what we've seen in the market is going to be whether you think it's someone like Edwin Dorsey over at the bear cave, what Hindenburg is doing.

We've talked to Dan David at Wolfpack Research. There are a lot of people now in the activist short space. And I think they believe there's a lot of opportunities out there, not just with Nikola and now Lordstown, as you've called out, Sozzi. But I think that'll be an interesting part of the market story as we go forward here in the coming years.

JULIE HYMAN: And it's also interesting on that point, by the way, you know, you saw people like Andrew Left, who was a notable short sale researcher, who backed away from short selling calls entirely in the wake of the whole GameStop meme stock situation. Obviously, some number of these other guys are undaunted and continue on with these calls.