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Helbiz (HLBZ) Stock Falls 20% as CEO Wages #NakedShortWar

Source: shutterstock.com/Radowitz
One of the most volatile names in the market over the past week, Helbiz (NASDAQ:HLBZ) is once again making headlines today. Unfortunately, it’s not because HLBZ stock is soaring. Rather, shares are seein…

Source: shutterstock.com/Radowitz

One of the most volatile names in the market over the past week, Helbiz (NASDAQ:HLBZ) is once again making headlines today. Unfortunately, it’s not because HLBZ stock is soaring. Rather, shares are seeing a rapid selloff, dropping approximately 20% from yesterday’s close.

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This move appears to be tied to profit-taking following the rather dramatic surge in HLBZ this week. Shares of the micro-mobility company surged from around 12 cents apiece last Thursday to as high as 55 cents per share yesterday. Today’s significant move has brought shares back down toward the 30 cent level, however.

Interestingly, this move also comes after yesterday’s announced preorder data for the company’s Wheels One platform. This last-mile, shared electric mobility platform has a “low center of gravity and 14-inch wheels,” allowing users to more easily traverse uneven surfaces. Preorders are expected to result in $2.2 million in sales for the company. That’s significant, considering that Helbiz’s market capitalization currently sits at around $45 million.

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Continued interest in HLBZ stock from short squeeze enthusiasts is another factor investors are watching closely today. With CEO Salvatore Palella suggesting more updates are upcoming in the “#NakedShortWar” Helbiz is waging against alleged illegal trading, HLBZ has the potential to bounce hard from these levels.

Let’s dive into what investors should expect from here with Helbiz.

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Where Is HLBZ Stock Headed From Here?

The past week has seen some rather intense volatility with HLBZ stock, which has been great for traders and speculators. Indeed, this is a stock with plenty of near-term catalysts, so bulls are going to be watching closely. Further, at an only $45 million market cap, shares may easily surge if retail investors can put the squeeze on.

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That said, the company’s loss-producing business is out of favor with most investors. HLBZ stock is heavily shorted for a reason. Whether it’s naked short selling or good old-fashioned short positions from individuals and institutional investors does matter. However, it’s unclear whether HLBZ stock will be able to avoid de-listing — another potential headwind on the horizon for the company.

At this point in time, I think those who are not in the speculation game should steer clear of Helbiz. This company has too much hair for the average investor. For those looking for moonshot bets, it may be attractive. But I’ll happily watch the carnage from the sidelines for now.

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On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

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