Fisker Stock Alert: EV Startup Defaults on $3.5 Million Loan
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One of the market’s most troubled electric vehicle (EV) stocks simply can’t catch a break. Fisker (OTCMKTS:FSRN) has spent the past six months bleeding out almost all of its value. Even after multiple random surges that shocked investors, Fisker stock is still down more than 96% for the past two quarters.
Today, though, the microcap penny stock is back in the green, even as the company reports even more bad news. Fisker has defaulted on a short-term $3.5 million loan that it received last month. This may not have pushed shares down, but it is still a concerning development for a company that already has many strikes against it.
What’s Happening With Fisker Stock?
Why would a company be rising on news that it had defaulted on a loan? In the case of Fisker, it can likely be attributed to the same phenomenon that boosted shares a few months ago when Fisker stock surged on new dealership partner news. These quick retail trading frenzies can lead to a quick boost for even unstable companies. But they are just as quick to run out of steam, leading to the stock’s gains being erased.
Fisker revealed in a recent regulatory filing that it has defaulted on a senior secured note worth $3.456 million, according to the note’s holder. As MarketWatch reports:
“The investor is exercising its right to immediately redeem all of the outstanding balance at a set redemption, including interest and other charges, Fisker said. The expiration of the company’s forbearance agreement with lenders and failure to make payments due under the short-term deal and previous debt agreements were listed among the reasons for default.”
This comes after bad news for Fisker has been piling up for weeks. Last week, the company announced yet another round of layoffs after multiple job cuts in just 2024. Fisker has also seen a significant decline in institutional investment, with Wall Street losing faith in FSRN stock. On top of all that, the automaker has recently scaled back its direct sales operations and admitted to production setbacks. And that’s just the recap from May 2024.
Why It Matters
At this point, investors should know better than to get their hopes up when Fisker stock sees a random surge. The fact that the company has defaulted on a short-term loan should remind everyone that shares are in a clear race to the bottom. The only thing that could potentially save Fisker would be if it finds a buyer to acquire it, but with every passing day, that seems less and less likely. This default news is just the latest in a long line of reasons to avoid Fisker as it careens toward bankruptcy and oblivion.
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On the date of publication, Samuel O’Brient 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.
