Why Polestar Automotive Stock Continues to Fall

As of 10:40 a.m. EST Monday.Polestar Automotive （Nasdaq ResonanceStock Code(PSNY)Shares fell 14.41 TP3T, the third consecutive day of losses since the company announced unusually weak vehicle deliveries in the first quarter. Last Thursday, Polestar said it delivered just 7,200 electric vehicles (EVs) during the quarter.

Poor figures

A year ago, the company delivered 12,076 electric vehicles, which means that the figure of 7,200 vehicles means that the Swedish company deliveredgo down 40%.

Polestar's chairman, Li Shufu, owns another 39.2% of the electric car company, S&P Global Market Intelligence said.

Koon said 2024 is a "transition year" as the company moves from producing just one electric model (Polestar 2) to adding two new electric SUVs (Polestar 3 and 4). With the introduction of these two SUVs, the company expects to realize volume growth and margin expansion in the second half of fiscal 2024. By 2025, the company expects to sell between 155,000 and 165,000 electric vehicles, representing a six-fold increase from the latest quarterly figures.

Is Polestar stock worth buying?

That's a pretty aggressive goal. And judging by investors' reaction to the company's first-quarter news, they don't believe Polestar can achieve it. Meanwhile, the stock remains a speculative investment.

At last report, the company had a market capitalization of $3.1 billion and net debt of $2 billion, and Polestar said it recently received $950 million in external funding from an international banking consortium. But that still means the company has an enterprise value of more than $4.1 billion and an enterprise value-to-sales ratio of around 1.5.Ford, US car companyThe enterprise value to sales ratio is only 1.General Motorsis 0.9, and both companies are profitable.

Polestar is not expected to be profitable until 2030 at the earliest. In my opinion, this is another good reason to sell the stock.

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Why has Polestar Automotive's share price continued to fall?