Hyzon Motors needed to provide the clarified figures for fiscal year 2022 on February 13, 2023 at the latest in order not to endanger its listing on the NASDAQ in accordance with rules and regulations. Now, the company has requested a new hearing, as Hyzon along with KPMG is under a comprehensive new audit for also the complete set of figures for the first business year, of 2021. As far as we know, there is a further extension time of 40 to 60 days. A hearing appointment for March 16th was requested and granted.
The current decline in the share price, in my view, is owed to investors fearing that it will be taken off the stock exchange. Hyzon, before the accounting irregularities, was financially well-positioned. Trucks are being delivered with much publicity, and they are seeking personnel after important management positions were newly filled. In the extreme case, the listing could continue on another exchange, the over-the-counter (OTC) market, as there are fewer regulatory conditions there.
From the sound of the press releases, I assume that Hyzon is creating clarity and will be able to keep its listing on the Nasdaq. Clear however is also that short sellers – around 18.5 million shares were sold short and thus over 20{7bfcd0aebedba9ec56d5615176ab7cebc5409dfb82345290162ba6c44abf8bc8} of the free float – will take advantage of the current uncertainty. But even short sellers may be inclined to stock up in anticipation of the 16th of March, since with the expected (by me) positive outcome of the auditing, the shares will make up a lot of ground at the stock market and so the company will be completely newly valued.
For traders as well the coming three weeks will be very exciting, when a high volatility in the development of the share price (price swings of 5, 10 or even 20 percent in just one trading session, depending on the news situation) must be assumed. Hyzon is addressing – like Nikola Motors – exactly the right first big market in the area of hydrogen mobility: commercial vehicles. Whoever as an investor has concerns here should get off and then get back on again when all uncertainties have been removed. Indeed a tough buy.
Disclaimer
Each investor must always be aware of their own risk when investing in shares and should consider a sensible risk diversification. The FC companies and shares mentioned here are small and mid cap, i.e. they are not standard stocks and their volatility is also much higher. This report is not meant to be viewed as purchase recommendations, and the author holds no liability for your actions. All information is based on publicly available sources and, as far as assessment is concerned, represents exclusively the personal opinion of the author, who focuses on medium- and long-term valuation and not on short-term profit. The author may be in possession of the shares presented here.
Written by author Sven Jösting, March 5th, 2023