The lukewarm reception for Polestar, the latest electric-vehicle company to go public in the U.S., is sending an ominous message to other startups: The purg
“When you are spending that kind of money for a vehicle, you at least want it to be reliable and know that the company will be around in a few years time,” said Greg Martin, managing director and co-founder of Rainmaker Securities.
Several EV-makers have lately seen the initial enthusiasm for their stocks evaporate. Anaheim, California-based Phoenix Motor is trading nearly 11% below its June 7 IPO price of $7.50 per share.Automotive has fallen 64% since its debut in November, while Luxembourg’s Arrival SA has lost more than 90% since listing in the U.S.
They’re part of a broader wave of weakness among recent IPOs as investors shy away from risk due to higher market volatility — a main reason this has been the weakest first half in nearly two decades for global stock offerings.Group still don’t fully reflect all the risks, experts said. Rivian is currently valued at about $26 billion, while Lucid Group stands at around $31 billion.
Rivian shares trade at a multiple of 129 times its sales, and Lucid at 359 times. For Ford, that number hovers around 0.4 times, according to Bloomberg data. For EV trailblazer Tesla, often criticized for its own high valuation, the price-to-sales multiple is 12. “The entire EV sector — Tesla included — remains overvalued based on any conventional metrics,” said Steve Sosnick, chief strategist at Interactive Brokers. While investors are still willing to pay a premium for the prospect of an EV future, certainly not all of the startups can meet the promise that the market is pricing in, Sosnick said. “That promises more swings ahead as investors handicap the eventual winners and losers.
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