Why Polestar Automotive (PSNY) Is Crashing?

We recently published a list of 10 Companies Reflect Market Decline. In this article, we are going to take a look at where Polestar Automotive Holding UK PLC (NASDAQ:PSNY) stands against other companies that reflect market decline.

The stock market was lackluster on Thursday, with Wall Street’s main indices ending the day with marginal declines.

The Dow Jones Industrial Average dipped by 0.16 percent, the S&P 500 shed 0.21 percent, and the Nasdaq Composite declined by 0.89 percent.

Ten companies mirrored the decline on Wall Street over a series of catalysts including uncertain government policies and disappointing earnings results.

Let’s take a closer look at the worst performers and explore the factors behind their declines.

To come up with Thursday’s top losers, we considered only the stocks with at least $2 billion in market capitalization and $5 million in daily trading volume.

A pristine electric vehicle parked in front of a modern Gothenburg skyline.

Polestar Automotive Holding UK PLC (NASDAQ:PSNY)

Swedish automaker Polestar Automotive Holding UK PLC (NASDAQ:PSNY) became Thursday’s biggest loser, with its share prices diving by 11.07 percent to end at $1.08 apiece.

Investors sold off positions after the company released disappointing earnings results for the first nine months of the year.

According to the company, revenues for the third quarter declined by 10 percent to $550.7 million from $608.6 million year-on-year, dragging down its nine-month revenues by 21 percent to $1.45 billion from $1.85 billion year-on-year.

Polestar Automotive (NASDAQ:PSNY) pointed to lower global vehicle sales of Polestar 2, coupled with higher discounts in a highly competitive market, and a delay in sales ramp-up of new carlines as having weighed on revenues.

Given the disappointing earnings results, Polestar also adjusted its full-year 2024 targets.

“The company now expects a mid-teens percentage decline in revenue and a negative gross margin around the same level as the full year 2023…Other one-time events also contributed to a difficult [fourth quarter], including a market value adjustment of inventory as well as continuing market pressure from discounting. A solid order intake for new models in late [fourth quarter] signals an encouraging start to 2025,” it said.

Overall, PSNY ranks 1st on our list of companies that reflect market decline. While we acknowledge the potential of PSNY as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PSNY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.