QuantumScape (NYSE:QS) Stock Extends Rally: How To Trade Now?
In recent weeks there have been some stocks which have managed to make notable gains which have brought those stocks to the radars of investors. One such stock is QuantumScape (NYSE:QS). The rollicking rally in the stock continue unabated on Thursday as it ended up with gains of 14% and those gains took the cumulative gains over the past month to 47%.
In light of such gains, it could be a wise move for investors to take a look into the stock and the company a bit more closely. In the first three days of this week, the stock had been one of the laggards and had declined by 6% but it made a strong comeback yesterday. The company is involved in the solid state battery space and reported its financial results for the second fiscal quarter after the closure of markets yesterday. Investors seemed to have taken to the stock after the announcement of its results and that possibly led to the strong upward move.
In the last quarter, QuantumScape had actually hit a major milestone after it managed to ship high cathode loading units to many automakers. The company claimed that the cells in question had higher energy density than the batteries which are in circulation in electric vehicles nowadays.
The cells had higher cathode and was in line with that QuantumScape had aimed to produce earlier on in 2023. In a letter to the shareholders, the management of the company revealed that the shipments represented a validation of QuantumScape to hit energy and power performance with its first commercial offering which could be the leader of the industry. Additionally, the company achieved another milestone during the quarter by making progress in further boosting its manufacturing capacity. The company went on to note that it had made plans to boost manufacturing capabilities across the board by scaling up its manufacturing processes in a pair of stages.
In the past, there had been a number of skeptics who had noted that due to the considerable technological hurdles solid state battery companies would not be able to achieve any kind of meaningful scale in its operations. The latest development from QuantumScape is an indication that the critics could be proven wrong in the long term. Hence, it is perhaps not a surprise that investors have piled on to the stock in recent times.
It is now going to be interesting to see if the stock can manage to hold on to its momentum and further add to its gains. The demand for electric vehicles would grow considerably in the coming years and hence, there could be an argument to be made in favour of sold state batteries if QuantumScape can deliver on the scale.
While it is still unclear if the company can deliver on scale, the latest developments suggest that it is in the right direction and made considerable progress on that particular front. Experts suggest that it could well be a stock to watch for 2023 as the demand for electric vehicles heats up further.
