Friday, September 08, 2023 10:07:50 AM
Courtesy davidsson10
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=172775246
Moves in the Vietnamese EV start-up's shares serve up lessons it can take seasoned traders years to learn.
Al Root, Aug 30, 2023
Watching the trading of Vietnamese EV start-up VinFast Auto is like a graduate-level course in the stock market, presenting lessons it typically takes seasoned traders years to learn.
The stock (ticker: VFS) fell for a second consecutive day on Wednesday, dropping 11% to close at $41.27. The S&P 500 and Nasdaq Composite rose 0.4% and 0.5%, respectively.
Only 11% is a modest move for VinFast stock. The average swing over the 12 trading days since the company merged with a special-purpose acquisition company and changed its stock symbol to “VFS” is 50%, up or down.
The first lesson is that any day’s move is basically a coin flip. VinFast stock has risen seven times and fallen five times. If investors look back to when the SPAC merger was approved, triggering a surge in volatility, the totals are eight rises and seven falls.
The second lesson is that volatility begets more volatility. When stocks jump or drop, big moves tend to follow, like aftershocks after an earthquake. Rarely do investors collectively take a stock up 255% in a day—it happened to VinFast on Aug. 15—and then decide it is perfectly valued.
Lesson three is about value. Sometimes the market doesn’t reflect the intrinsic value of an individual business.
The SPAC merger valued VinFast at about $23 billion, which is more than Rivian Automotive ‘s (RIVN) market capitalization. Rivian delivers more cars than VinFast, but $23 billion is in the EV start-up ballpark and is the level where VinFast and a group of investors felt good about a deal. At its intraday peak of $93 a share, VinFast stock was worth about $215 billion, closer to Toyota Motor (TM) than Rivian.
Wednesday’s move left VinFast with a market capitalization of about $96 billion. That moves it to the fourth-most valuable automaker on the planet, behind Porsche (P911. Germany). Tesla (TSLA) and Toyota (TM) are one and two. China’s BYD (1211. Hong Kong) is a hair behind VinFast based on data from FactSet . Ford Motor (F) and General Motors (GM) shares are worth about $94 billion combined.
The fourth lesson is there are other ways to check whether the market is being rational. Vingroup (VIC. Vietnam) owns almost 1.2 billion shares of VinFast stock, which is worth almost $50 billion, but Vingroup’s market capitalization is only about $9 billion.
It is up roughly 10% since “VFS” started trading, but the move doesn’t reflect Vingroup’s VinFast holdings. That tells investors either that there is an arbitrage opportunity in Vingroup stock or that few think the VinFast valuation is real.
The fifth lesson is that volatility attracts traders. More than 100 million VinFast shares have traded over the past 12 days. There are only about 17 million or 20 million shares not held by insiders available to trade. That means the average holding period for VinFast stock recently has been less than two days.
A final point to remember is that in the long run, cash flow and earnings will ultimately determine what VinFast stock, or any stock, is worth.
Barron's
To bite the worm of incite is to bite the HOOK of the antagonist . They win .
Recent VFS News
- Investors in VinFast Auto Ltd. f/k/a Black Spade Acquisition Co. Should Contact The Gross Law Firm Before June 11, 2024 to Discuss Your Rights - VFS • PR Newswire (US) • 06/05/2024 09:45:00 AM
- Robinhood Shares Surge 3.3% on Stock Buyback Announcement; Anglo Declines BHP Deadline Extension, and More News • IH Market News • 05/29/2024 11:34:18 AM
- The Gross Law Firm Reminds Shareholders of a Lead Plaintiff Deadline of June 11, 2024 in VinFast Auto Lawsuit - VFS • PR Newswire (US) • 05/29/2024 09:45:00 AM
- CalPERS to Oppose Exxon Mobil Directors; Microsoft Unveils Copilot+ PCs with AI Focus, and More News • IH Market News • 05/21/2024 11:18:35 AM
- Shareholders that lost money on VinFast Auto Ltd. f/k/a Black Spade Acquisition Co.(VFS) should contact The Gross Law Firm about pending Class Action - VFS • PR Newswire (US) • 05/21/2024 09:45:00 AM
- Investors in VinFast Auto Ltd. f/k/a Black Spade Acquisition Co. Should Contact The Gross Law Firm Before June 11, 2024 to Discuss Your Rights - VFS • PR Newswire (US) • 05/14/2024 09:45:00 AM
- VinFast Auto Ltd. f/k/a Black Spade Acquisition Co. Sued for Securities Law Violations - Investors Should Contact The Gross Law Firm Before June 11, 2024 to Discuss Your Rights - VFS • PR Newswire (US) • 05/10/2024 09:45:00 AM
- Shareholders of VinFast Auto Ltd. f/k/a Black Spade Acquisition Co. Should Contact The Gross Law Firm Before June 11, 2024 to Discuss Your Rights - VFS • PR Newswire (US) • 05/07/2024 10:00:00 AM
- VinFast Auto Ltd. f/k/a Black Spade Acquisition Co. Sued for Securities Law Violations - Investors Should Contact The Gross Law Firm Before June 11, 2024 to Discuss Your Rights - VFS • PR Newswire (US) • 05/03/2024 09:45:00 AM
- Investors who lost money on VinFast Auto Ltd. f/k/a Black Spade Acquisition Co.(VFS) should contact The Gross Law Firm about pending Class Action - VFS • PR Newswire (US) • 04/26/2024 09:45:00 AM
- BHP Bids $38.8 Billion for Anglo American; Biden Unveils Historic Micron Technology Deal, and More News • IH Market News • 04/25/2024 11:48:40 AM
- VinFast Auto Ltd. f/k/a Black Spade Acquisition Co. Securities Fraud Class Action Lawsuit Pending: Contact The Gross Law Firm Before June 11, 2024 to Discuss Your Rights - VFS • PR Newswire (US) • 04/19/2024 10:35:00 AM
- TSMC Revenue Rises 13% in Q1, Alcoa Exceeds EBITDA Expectations Despite Loss, and More Earnings News • IH Market News • 04/18/2024 11:14:18 AM
- VinFast participera au salon du véhicule électrique de Montréal de 2024 • Business Wire • 04/15/2024 10:44:00 PM
- Paramount Global Board Shrinks, Morgan Stanley Faces Regulatory Probe, and More News • IH Market News • 04/12/2024 11:05:29 AM
- GameStop Shares Tumble 20% in Pre-Market Trading Amid Revenue Decline, Direct Digital Plummets 42%, and More News • IH Market News • 03/27/2024 10:54:47 AM
- VinFast sera présent au Salon international de l'auto de Vancouver 2024 • Business Wire • 03/14/2024 04:04:00 PM
- Goldman Sachs Reconsiders Fed Cuts, LUNR Surges Over 40% in Pre-Market, and More • IH Market News • 02/23/2024 01:03:59 PM
- VinFast Reports Unaudited Fourth Quarter and Full Year 2023 Financial Results • PR Newswire (US) • 02/22/2024 01:13:00 PM
- Boeing Faces Strike Threat, Palantir Up 18% After Recording its First Profitable Year, and More • IH Market News • 02/06/2024 11:14:00 AM
- VINFAST TO ATTEND THE 2024 NATIONAL AUTOMOBILE DEALERS ASSOCIATION SHOW • PR Newswire (US) • 01/31/2024 11:22:00 AM
- Arcus Biosciences Stock Jumps 20% on $320M Gilead Investment, Super Micro Surpasses Forecasts, and More News • IH Market News • 01/30/2024 11:25:14 AM
- Wall Street Highlights: Tesla Launches Restyled Model 3, VinFast Unveils Pickup Prototype, and More • IH Market News • 01/10/2024 11:21:31 AM
- VINFAST LAUNCHES THE DRGNFLY ELECTRIC BIKE IN THE U.S. MARKET • PR Newswire (US) • 01/10/2024 11:00:00 AM
- VINFAST UNVEILS NEW ELECTRIC PICKUP TRUCK CONCEPT - VF WILD • PR Newswire (US) • 01/09/2024 10:14:00 PM
Mushrooms Inc. (OTC: MSRM) Announces Significant Share Buy Back by the Board Director and New Strategic Initiatives. • MSRM • Jun 5, 2024 1:32 PM
Hydromer Announces Launch of HydroThrombX Medical Device Coating Technology • HYDI • Jun 5, 2024 10:24 AM
Dr. Michael Dent Finances $1 Million to Drive HealthLynked's Healthcare Transformation • HLYK • Jun 5, 2024 8:00 AM
Avant Technologies Enters Binding LOI to Purchase Dozens of High-Performance, Immersible, AI-Powered Servers • AVAI • Jun 5, 2024 8:00 AM
IQST - iQSTEL Announces $290 Million 2024 Annual Revenue Forecast • IQST • Jun 4, 2024 1:43 PM
ECGI Holdings Accelerates Strategic Initiatives by Securing First of Two $125,000 Convertible Notes • ECGI • Jun 4, 2024 12:15 PM