Share This Article

Facebook LinkedIn
Twitter Reddit
Print Email
Pinterest Gmail
Yahoo
Money Morning
×
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
  • Retire
    • Income Investing Guide
    • Retirement Articles
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
Login Archives Your Team About Us FAQ
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
    ×
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
    ×
  • Retire
    • Income Investing Guide
    • Retirement Articles
    ×
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
    ×
  • Subscribe
Enter stock ticker or keyword
×
Join 100,000+ Like-Minded Investors Today
Twitter
Tags: IPOs
Stocks: SEV

Avoid Sono Motors Stock After the IPO

By Coty Poynter, Associate Editor, Money Morning • November 16, 2021

View Comments

Start the conversation

Leave a Reply Click here to cancel reply.

You must be logged in to post a comment.

Sono Motors stock goes public soon. The company trades on the Nasdaq under the ticker SEV for between $14 and $16 per share. The electric vehicle (EV) stock will be available through Robinhood IPO Access, which means some investors will get a chance to own shares before this stock hits the exchanges.

We're going to show you whether that's a good idea or not.

This IPO comes hot on the heels of Rivian's successful launch and looks to capitalize on the hype around EV stocks. At the high end of the 10 million shares offered, Sono Motors could hit a valuation of $1.1 billion.

So, should you buy shares of Sono Motors stock amid the EV hype? Let's find out...

What Is Sono Motors?

Founded in 2016, Sono Motors is an automaker based in Munich, Germany, that focuses on developing solar-powered electric vehicles.

While solar-powered vehicles are nothing new - both Hyundai and Toyota offer vehicles that blend electric and solar - Sono Motors intends to add to the competition with its Sion model.

The Sion can also be charged via charger and run 190 miles on one full battery. While this is low compared to the typical range of 300 miles per charge, Sono Motors' Sion is priced much lower at $32,650 compared to $40,690 for Tesla's Model 3.

But what sets Sono Motors apart from other EVs on the market now is the ability to integrate solar panels into the vehicle. This is where the Sion shines. When the car's solar-powered system is in use, it can add just over 69 miles on average per week. At most, it can top out at 152 extra miles per week.

The thing is, this solar integration is offered as a standalone service as well. So long as it's an EV or a diesel vehicle, then solar panels can be added to any car. Sono Motors estimates that more than half of the vehicles sold in 2030 will be suitable for solar retrofitting, with a third being suitable for solar integration. And more than two-thirds of the vehicles sold in 2040 will be suitable for solar integration.

While this helps the company to expand further than just its own EV sales, it doesn't mean that it's worth investing in. To get a better idea, let's look at Sono Motors' balance sheet...

Is Sono Motors Profitable?

As of right now, the company has "no relevant revenue." Which is to say that it's not profitable at this time. The company is still in pre-production mode, so it isn't currently generating regular revenue.

In fact, Sono Motors lost $29 million in the first six months of 2021. And since the company's founding back in 2016, Sono Motors has accumulated a deficit of more than $120 million.

Sono Motors is hoping to turn things around though.

The company's first EV, Sion, has 16,000 reservations, each with a down payment of about $3,000. That's brought in at least $48 million for the EV company. Those reservations should start to be filled by 2023.

Here's why we're taking that with a grain of salt: Back in 2018, Sono Motors had 7,000 reservations. Customers were told they'd have their cars in early 2019, but that was then postponed until 2021.

Now, if this 2023 deadline gets pushed further back and customers want to cancel their reservation and get a refund, they can if Sono Motors hasn't spent the money on the production of the vehicles.

Speaking of production...

Sono Motors plans to outsource production to National Electric Vehicle Sweden (NEVS). The trouble is, NEVS is owned by the Chinese firm Evergrande. This is the same Evergrande that's more than $300 billion in debt and threatening the global economy.

All of this is to say...

Why to Avoid Sono Motors Stock

It's best to avoid this company after the IPO. Right now, all the attention and hype in the EV space is sending EV IPOs through the roof. Consider the fact that Rivian is somehow more valuable than Ford or GM despite not having delivered a single vehicle yet.

That's one more reason investors should take a "wait and see" approach with these hype beasts. Especially when it comes to Sonos Motor...

The company expects to raise roughly $135 million from the IPO. But even that isn't enough to move the company's EVs into production. Just to get the production off the ground, Sono Motors needs at least $410 million. So, it will have to figure out where to make up that $275 million deficit after the IPO just to meet current production needs.

The other issue is that solar-powered cars of this era will not be able to power themselves. While Sono Motors Sion is able to stretch the battery life, owners will still have to pull off to recharge the battery. There's not a huge payoff, especially when, say, Tesla's Model 3 estimated mileage is 358, far better than what the Sion offers.

So, with this one, take the "wait and see" approach until Sono Motors delivers the first round of vehicles in 2023.

Will This Be the Nasdaq's Biggest Winner of 2021?

This tiny EV stock is on a roll. After dominating the foreign exchanges, it's primed to be one of the biggest - if not the biggest - winners on the Nasdaq.

Now one of the biggest oil companies in the world is throwing everything it's got into this new startup before it goes public.

Find out why.

Follow Money Morning on Facebook and Twitter.

Here Are 10 “One-Click” Ways to Earn 10% or Better on Your Money Every Quarter

Appreciation is great, but it’s possible to get even more out of the shares you own. A lot more: you can easily beat inflation and collect regular income to spare. There are no complicated trades to put on, no high-level options clearances necessary. In fact, you can do this with a couple of mouse clicks – passive income redefined. Click here for the report…

Claim My Free Report

Subscribe
Login
Notify of
guest

guest

1 Comment
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Neozyklon
Neozyklon
1 year ago

Strongly disagree with the sentiments shared..This is first of its kind. SONO Motors is going to be a hit. Their booking continue to increase amid interest.

-3
Reply


Latest News

September 14, 2023 • By Garrett Baldwin

This Is My Biggest Economic Fear

September 14, 2023 • By Shah Gilani

earnings
What You Should Do About AI's Latest IPO Right Now

September 14, 2023 • By Addison Wiggin

Rapid Intensification
Trending Stories
ABOUT MONEY MORNING

Money Morning gives you access to a team of market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.

QUICK LINKS
About Us COVID-19 Announcements How Money Morning Works FAQs Contact Us Search Article Archive Forgot Username/Password Archives Profit Academy Research Your Team Videos Text Messaging Terms of Use
FREE NEWSLETTERS
Total Wealth Research Power Profit Trades Penny Hawk Midday Momentum
PREMIUM SERVICES
Money Map Press Home Money Map Report Fast Fortune Club Weekly Cash Clock Microcurrency Trader Hyperdrive Portfolio Rocket Wealth Initiative Quantum Data Profits Flashpoint Trader Darknet Alpha Accelerators Brutus Alerts Resource Traders Alliance L.A.U.N.C.H. Investor Rob Roy Trader Long-Term Equity Profits

© 2023 Money Morning All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning.

Address: 1125 N Charles St. | Baltimore, MD, 21201 | USA | Phone: 888.384.8339 | Disclaimer | Sitemap | Privacy Policy | Whitelist Us | Do Not Sell or Share My Personal Information

wpDiscuz