Recent Large Drop… in Detail

“I’m only rich because I know when I’m wrong…I basically have survived by recognizing my mistakes.” ~ George Soros

Dear Trader,

Welcome to today’s edition of Wall Street Connected.

Electric vehicle stocks highlighted 2020 for traders and investors alike.

Some made upside moves of 1,000% or more.

One of these stocks was Workhorse Group Inc (WKHS).

In June of 2020 the stock was trading around $2/share. Only six months later, it was $30/share. That’s an incredible increase in price-per-share.

However, just last week, WKHS stock declined by over 50% in price-per-share in one single trading session.

Upon the U.S. Postal Service announcing it was awarding Oshkosh Defense (OSK) a contract to manufacture its next generation of postal delivery vehicles, Workhorse was ruled out as a competitor for the $600M+ contract, and witnessed a sudden drop as a result.

But the bearish news for WKHS didn’t end with losing a $600M+ contract.

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Oppenheimer analyst Colin Rusch proceeded to downgrade the stock to perform from outperform without a price target, which essentially provided traders and investors with an unlimited downside profit target on the stock.

This could explain why the stock is ranking on the top 20 stocks which financial professionals were searching last week…

While this was bad news for Workhorse Group, bad news can be good news for their competitors.

On the same day which WKHS declined by over 50% in price-per-share, two of their largest competitors rebounded from recent lows as bulls cut positions in Workhorse and transferred their funds.

Li Auto Inc (LI) gained $4/share intraday.

Nio Inc (NIO), debatably Workhorse’s largest competitor, rose nearly $9/share.

TrackStarIQ Data

Here are some highlights from this past week…

RANKTOP SEARCHES BY FAs (Total Traffic) Previous Week [STOCKS]TOP SEARCHES BY FAs w/ AUM>$1B (Total Traffic) Previous Week [STOCKS]TOP INDUSTRY SEARCHES BY FAs (Total Traffic) Previous Week [EQUITIES]TOP INDUSTRY SEARCHES BY FAs w/ AUM>$1B (Total Traffic) Previous Week [EQUITIES]
1AMCIWSYBiotechnologyCredit Services
2TSLAAMCEntertainmentConglomerates
3GMEZOMAuto ManufacturersElectrical Equipment & Parts
4CCIVOPTIDrug Manufacturers – Specialty & GenericCommunication Equipment
5AAPLOPTISpecialty RetailApparel Manufacturing
6SOSGTLLSoftware – ApplicationOil & Gas Midstream
7SOSGTLLSemiconductorsMarine Shipping
8PFEROKUComputer HardwareInsurance – Property & Casualty
9PLTRHCMCConsumer ElectronicsGold
10WKHSCCIVOil & Gas E&PBanks – Regional
11SNDLOCGNDrug Manufacturers – GeneralTravel Services
12OCGNBNGODiagnostics & ResearchSpecialty Chemicals
13ZOMUSEISoftware – InfrastructurePackaging & Containers
14NIOETFMTelecom ServicesUtilities – Regulated Electric
15NAKDINKWInternet Content & InformationBanks – Diversified
16NEWSTSLAMedical DevicesLeisure
17BAWKHSAuto PartsOther Industrial Metals & Mining
18PTONBAAerospace & DefenseScientific & Technical Instruments
19GTTMACSpecialty Industrial MachineryAirlines
20CTRMSOSInternet RetailCapital Markets

What We’re Reading:

  1. Today: ISM manufacturing, construction spending
  2. Top five weekend stock stories
  3. COVID-19 test results and vaccinations

What We’re Watching:

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You can watch it here.

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