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Hyzon Motors: Bear Raid Looks Like It Missed Its Target

Oct. 06, 2021 8:30 AM ETHyzon Motors Inc. (HYZN), HYZNW30 Comments
Vince Martin profile picture
Vince Martin


  • HYZN stock still is down 30% from where it traded before Blue Orca Capital released a short report last week with allegations including fake orders, fake customers, and executive resignations.
  • Hyzon's response on Tuesday seems to adequately address the core concerns, yet the market seems still skeptical.
  • To be sure, Hyzon stock remains a high-risk play — yet it's difficult to see what, precisely, has changed over the last six trading sessions.
  • As a result, there's an intriguing case for stepping in here.

H2 hydrogen station

Olemedia/E+ via Getty Images

Different investors have very different opinions about "activist shorts," who release negative reports about stocks in a bid to profit from short positions. But whatever one's stance on the ethics of the trade, recent history in the electric mobility

This article was written by

Vince Martin profile picture
Overlooked Alpha launched April 2022 - subscribe at overlookedalpha.com. Some OA articles are also available here at Seeking Alpha.I've been contributing to Seeking Alpha and other investment websites since 2011, with a general (though far from rigid) focus on value over growth. I got my Series 7 and 63 back in 1999, and watched the dot-com bubble peak and then burst in real time at a small, tech-focused retail brokerage in NYC.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of HYZNW either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (30)

Where are all of these trucks going to fuel?
@antoncretu So this isn't for interstate highway trucks?
you can not put credence in an attack by a entity that is short selling a stock. period. end of story. next..........
Vince Martin profile picture
@cvvran that's a ridiculous statement. Nikola, Luckin, Ideanomics, just off the top of my head...there are many more I could think of if it wasn't almost midnight.

if you really believe what you say, then you must also believe the converse: that you can't listen to a bullish argument from someone who owns the stock. both sides have equivalent incentives.
wantedtoretireearly profile picture
@Vince Martin Agree. Enron is another example.
Well my unprofessional advice is that the current stock price is where we shouldn't be focused on. I see them doing things like promoting there truck via channels which I guess is good. Like Zero Emissions Ecomobile fair. My guts says this company shouldn’t even be worried about those allegations from short attack reports. We should they care? If in the beginning the stock price would be on $20 dollars right now, then what is the real intrinsic value of this company? Nada nopes. I think the current price is exactly where it should be! I’m not saying its bad, but its more realistic to be at a low level then high at the moment. Failures are more forgiven at these low prices. I still don't have trust issues, but rather a higher ego to them short attacks.
Vince Martin profile picture
@TrueFactsOnly I think that's all true. I thought their response to the attack was pretty much that way - we're going to respond to what we see as errors and/or mischaracterizations, and that's it.
Short sellers often say that the louder the company and/or CEO gets in these situations, the closer they pay attention. It's the ones threatening lawsuits or screaming about bias (Nikola being a pretty good example of the latter) that seem less credible. I thought their response was pretty measured: we have to reply and now we're moving on. So far, the market still pretty obviously disagrees.
crizoule profile picture
I'm stunned by your interpretation of the short report and Hyzon's response.

It's a huge short for me:

- Small-cap Chinese public companies are well-known to deceive investors (repackaged Chinese company). Not every Chinese public company is like that, of course.

- Phantom big-names: Hyzon's explanation is super weak. Saying you had big customers and for some reason all those big names want anonymity. I mean cmon, it's pretty clear they are lying right there.

- 2 consecutive CTO resigned within a short timelapse. Again, pretty obvious they are lying or playing with words. He was not a CTO, he was a consultant. Or the best one: Robb "retired"... lol

- Hyzon's big customer explanation is very weak also. True or not, it's a non-binding agreement so little value for me.

- Hydrogen cells in automotive won't be affordable for a long time if ever. The lithium case is working and is increasingly cheaper.

Sure, the short report is not perfect but mostly correct. And Hyzon barely defended on the big allegations.
Vince Martin profile picture

- to your first point, I think many more SPACs deceive investors than small-cap Chinese companies. but I also don't think that proves anything here.
- I would agree more on the big customers if the July presentation didn't mention them at all. Then it's, "they made up Coke and Heineken and IKEA." But the three companies are still in there.
To me, comparing logos on slides is a meaningless exercise. But maybe that's because I think looking at those logos has little value to begin with.
- here I'm going to disagree a little more strongly. It's not playing with words. The short report only calls Anderson a CTO bc it's on his freaking LinkedIn. And the fact that he resigned is not a surprise because he wasn't doing that much anyway. Hyzon was barely in business in the first half of 2020 for a number of reasons. It's not likely he was in charge of this massive R&D ramp and jumped ship after five months. It's not bearish that the guy left and they brought on a new, permanent, hire at that point, whatever Anderson's title. I see no evidence that Anderson was a material part of this business.
As far as Robb goes...why is "retired" in quotes?
- I agree the Hiringa agreement has little value, particularly at this stage. I disagree that Hyzon presented it otherwise.
- Lithium-ion or lithium-metal have very real disadvantages in the commercial end market. And it would seem unlikely (possible, but unlikely) that lithium-ion or lithium-metal will get cheaper and FCs won't. Similar trends are at play in both.
@crizoule It comes down to the financial projections for me. Lets see if they stick to the 2022 and 2023 revenue projections when they have their Q3 earnings call between now and November 15th.
crizoule profile picture
@DavidHHolmes Forecasts are only forecasts. I can start a company, have some kind of prototypes that few understand, and say I will have X millions and lure hopium investors. Not saying you are but after the short allegations and their response, I only see dark clouds ahead. Wish you the best.
Wedbush has spoken about the recent short reports. Copied this partial Wedbush from another source.

"We are very satisfied by Hyzon's detailed response and ultimately any questions that investors had over the last week were answered fully in our opinion, as hopefully, this puts the short report saga in the rear view.

"Hyzon is a hydrogen leader, focus on investment thesis not the bear noise. Taking a step back, we are starting to see a number of pilot projects globally (including in the US) and increased activity around the use of hydrogen for the long haul trucking industry and ultimately believe Hyzon is quickly establishing itself as the clear leader in this key market opportunity. While the hydrogen trucking opportunity will take some time to play out, we are getting increasingly confident about the growth and adoption potential for Hyzon over the coming years with diesel trucking conversion opportunities abound. We maintain our OUTPERFORM rating and $15 price target on Hyzon."
Vince Martin profile picture
@PN88 thanks for that. Street is pretty bullish, for what it's worth (readers no doubt have *very* different ideas of what that's worth).
@Vince Martin - that's what makes the market.... I'm inclined to side with Wedbush in this case.
@PN88 SEC investigation just announced. May want to stay on the sideline for now.
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