Penny Stock, Workhorse Gallups to 2019 Highs After Trump Tweet
Everyone is talking about how “Trump Tweets” are sending stocks plunging. But on May 8, the US President tweeted something that sent a particular penny stock soaring. The company is Workhorse Group Inc. (WKHS Stock Chart). They focus, in particular, on electric vehicles. Now, since the better part of last August, shares of WKHS have struggled to even break $1.50. Most of the year, the stock traded under $1.15.
So Why Did A Trump Tweet Send This Penny Stock Higher?
In a May 8th Tweet, the president came out and said that General Motors (GM Stock Chart) CEO Mary Barra told him that GM will sell its Lordstown manufacturing plant to Workhorse. The result will be to build electric trucks. GM later confirmed that it is still in talks about a possible sale of the Warren, Ohio-based plant.
The tweet actually ended up crashing the company’s website. It also sparked so much interest in the market that the penny stock was halted due to circuit breakers triggering a pause in trading. Trump in another tweet added that GM will spend $700 million in 3 separate Ohio locations, creating 450 jobs.
“The first vehicle we would plan to build if we were to purchase the Lordstown Complex would be a commercial electric pickup, blending Workhorse’s technology with Lordstown’s manufacturing expertise.”Workhorse founder Steve Burns said in a statement.
Where Could Speculation Lead?
Some accounts are saying that this could be a play to secure a scaled facility in order to fulfill orders for the US Postal Service. According to Trucks.com, U.S. Postmaster General Megan Brennan expressed to a congressional committee last week that a final decision is expected by fall on its “Long Life Vehicle.”
The contract calls for 180,000 trucks to be delivered over five to seven years at a price between $25,000 and $35,000 each. This means that a deal of this size could be worth as much as $6.3 billion to the winner.
“This potential agreement creates a positive outcome for all parties involved and will help solidify the leadership of Workhorse’s role in the EV community,” Workhorse CEO Duane Hughes said in a press release Wednesday.