Why Is Lordstown Motors (RIDE) Stock Up Today — June 16?

By Updated on June 16, 2023

Why Is Lordstown Motors (RIDE) Stock Up Today — June 16? Thumbnail

Lordstown Motors (NASDAQ: RIDE) stock spiked over 60% from yesterday’s, continuing the momentum from last week and benefitting from the hotness of the electric vehicle (EV) sector. Entering the mid-point of the trading day, RIDE is still up more than 25% since the start of the day!

This price move coincided with a surge in volume. 38 million shares have traded hands so far today — almost tripling the reverse split-shrunken float!

EV Sector Momentum

The broader EV sector has been experiencing considerable momentum, largely attributed to the Federal Reserve’s decision to pause rate hikes, which has sparked a rally in EV-related stocks.

Lordstown Motors is part of the EV sector. It recently experienced a significant surge in its share price, despite a lack of company-specific news. In the past week, it’s up 125%.

This surge is indicative of strong demand for EV stocks in general, and Tesla (NASDAQ: TSLA) stock in particular. This positive sentiment has spread to other companies involved in the EV sector, leading to a sympathy boost in their share prices.

RIDE Chart Patterns

Lordstown’s chart reveals a strong upward trend, with the stock rallying considerably over the past week. This upward movement aligns with the broader bullish trend observed in the EV sector.

Over a longer timeframe, this spike is a tiny blip on this stock’s long fade. It’s lost nearly 99% from its 2021 high!

Is RIDE Stock a Buy on June 16?

Here’s what we like: There’s been some tradeable chart action in this stock over the past few days. Even if it fades, chances are there will be some bounces on the way.

The company’s stock float has been significantly reduced due to a 1-for-15 reverse stock split. While this move was intended to maintain compliance with Nasdaq’s minimum listing requirements, it also means that less volume is needed to move the stock price, making it more volatile.

Here’s what we don’t like: Reverse splits are often a sign that a company is in trouble and can’t get its stock price up based on real value. This consolidation of every 15 shares of RIDE stock into a single share has increased the price of its stock without directly affecting its market capitalization or shareholders’ stakes in the company.

In the long-term, RIDE has been in a consistent downtrend. Nothing material has changed about this stock, even with the 125% run this stock has gone on this week.

Whether RIDE is a buy or not depends on your individual trading strategy and goals. Have a trading plan, and follow it!

Tim Sykes has no position in any of the stocks mentioned. Timothysykes.com has a disclosure policy.


How much has this post helped you?

Comments (1)
Author imageTimothy Sykes
Hey Everyone,

As many of you already know I grew up in a middle class family and didn't have many luxuries. But through trading I was able to change my circumstances --not just for me -- but for my parents as well. I now want to help you and thousands of other people from all around the world achieve similar results!

Which is why I've launched my Trading Challenge. I’m extremely determined to create a millionaire trader out of one my students and hopefully it will be you.

So when you get a chance make sure you check it out.

PS: Don’t forget to check out my 30 Day Bootcamp, it will teach you everything you need to know about trading.

Leave a Reply