Electric Vehicle Battery Technology Company Stock
soars after company reported second quarter earnings Tuesday evening. There was good news, but it’s not really a good reason for a double-digit jump. The stock is just very volatile.
The company reported a loss of 12 cents a share, but profits don’t matter that much. There are no sales. More importantly, the first 10-layer cells are tested. QuantumScape is still a long way from commercial sale. The company is a pioneer in solid-state lithium anode batteries. Solid state, in this case, means there is no liquid in the batteries, facilitating the movement of electrons. QuantumScape’s technology promises better EV range and safety, along with faster charging times and lower costs.
Still, Quantum (ticker: QS) stock is up 8.6% in early trading at $23.25. Shares traded as high at $24.38, up 13.9%. The S&P 500 and Dow Jones Industrial Average, by comparison, are up 0.1% and flat, respectively.
A QuantumScape battery looks like a playing card. A major challenge for the company is turning one card into a deck of cards. That’s what it takes to build automotive-grade cells. Along the way, many decks will form the basis for an EV battery back.
“Our goal was to have 10-ply cells by the end of 2021, so we are encouraged to have our first 10-ply cells as early as this,” said CEO Jagdeep Singh during the company’s earnings conference call. The company tested a 4-layer cell in February. “The development of 10-layer cells is the result of a number of concrete improvements in our production process for separators.”
Faster development is positive for the company and the stock. Still, options markets implied a 16% move, up or down, after gains. Part of the bounce on Wednesday is due to QuantumScape stocks being very volatile.
The stock even fell 7.4% after reporting its first quarter earnings. That was the report in which the company said it was testing its 4-layer cell.
With the company still years away from commercialization, investors will likely have to live with above-average volatility. QuantumScape shares are down more than 80% from its 52-week high of $132.73 and more than 140% above its 52-week low of $9.74.
Shares are down about 72% so far.
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