On the surface, U Power Limited (NASDAQ:UCAR) may not seem like it has much connection to the electric vehicle market. But as a battery-swapping technology maker, it could be much more important than many expected. However, it’s not exactly delivering on its overall value; it’s lost over 20% in Tuesday afternoon’s trading.
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U Power started off last week with a bang that was more like an explosion. Up over 1,100% at one point, shares went from roughly $6 to around $75. But now, shares have dropped to below $6, and there’s little sign of another massive run-up to follow. The movement in shares was so erratic that trading in U Power was actually halted 22 separate times by NASDAQ due to “abnormal trading.”
Analysts were baffled. Donovan Jones with Seeking Alpha noted that U Power hadn’t produced a lot of revenue and that there were several major risks associated with a stock so connected to China. But Jones also noted U Power’s “ultra-low float,” which may have made it attractive to “day traders seeking volatility,” which it indeed offered in extreme quantities. For its part, U Power expected to complete its IPO last Friday, realizing $14.5 million in total that it would use for developing battery-swapping stations.
A look at the last five days in trading for U Power Limited Stock shows exactly the kind of volatility that investors dealt with. Share prices explode before the bottom drops out, and its price slumps to below its IPO price. And that’s all in the course of about a week.
