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Hyzon Motors Down 17% on SEC Investigation Over Fraud Claims

Trade Hyzon Stock Your Capital Is At Risk
Updated: 12 Jan 2022

Key points:

  • Hyzon Stock plummets 17% in Wednesday premarket trading following SEC Investigation
  • The latest alarm bell to hit fledgling clean-energy companies, following Nikola's fraud accusations
  • Investors should act with caution with such a lack of fundamental insight

 

Taking a premarket blow; Hyzon Motors (NASDAQ: HYZN) stock plunged over 17% following an announcement that the company has received a subpoena from the SEC regarding an earlier allegation made by an investment firm Blue Orca.

The news rings as a further alarm bell regarding recent new, hype-embellished companies, of which there is a lot of speculation regarding accurate fundamentals over investor attraction. 

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The hydrogen fuel-cell truck maker has had a tough ride following its public debut back in July last year, and akin to the likes of other fledgling clean-energy vehicle companies; is yet to actually go public with any vehicle – even amidst high-swinging growth estimates and order numbers.

Hyzon has been the latest to breed suspicion; after Blue Orca made allegations that Hyzon’s largest customer Shanghai HongYun was a ‘fake company’, created from thin air just days before a 500 vehicle deal was announced. Shady? Investors certainly seem to think so.

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The claim was made back in September, with Hyzon responding the following month denying all allegations and any meeting with the short seller seeking verification for their bold claims. 

There seems to be a pattern emerging within the contentious realm of over-polished companies like Hyzon. Nikola, the electric truck maker, has recently been through a similar debacle following fraud accusations in an investor presentation. The luxury EV manufacturer Lucid, who had an incredibly successful public debut, has issued multiple delays for their public launch and has also been victim of an SEC investigation– with little actual fundamental evidence to suggest a firm position in such a competitive market. 

The following months might prove choppy for Hyzon stock. Investors should act with caution when it comes to new EV and fuel-cell vehicle companies. Whilst it is a pivotal time for sector investment, an informed choice should amount to more than rose-tinted speculation and embellished revenue estimates.

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