(Reuters) – Shares in electric truck maker Nikola Corp were up 1.6% on Tuesday a day after its founder disclosed that he had sold fewer shares in the company than investors had feared.
Founder and former executive chairman of Nikola, Trevor Milton, sold just 3.34 million of his 91.6 million shares in the company, according to a regulatory filing on Monday.
On Dec. 1, shares in Nikola sank 14.9% as a lock-up period expired, allowing certain insiders to sell shares, just a day after General Motors Co revised its deal with the company.
But Monday’s disclosure suggests that “Milton plans to remain Nikola’s biggest shareholder” according to Wedbush analyst Daniel Ives.
“There’s an added confidence investors are reading into that,” said Ives.
The analyst, who has a ‘sell’ rating on the stock, said investors are also likely moving on from last week’s GM news.
“Many are now looking at Nikola as now a potential EV (electric vehicle) play with the GM noise now in the rear view mirror,” said Ives who has a $15 price target on the stock.
Nikola shares last traded at $18.74, though trading volume was light at 0.2 times the 10-day moving average. The stock had lost almost 50% of its value between Nov. 24, when it closed at $34.50, and Dec. 1, when it closed at $17.37.
However it is still up 81.9% so far this year.
“Investors are going to continue to take a cautious wait-and-see approach but I do think potentially the tide’s turning in terms of a lot of bad news in the rear-view mirror,” said Ives.
Reporting By Sinéad Carew; Editing by Bernadette Baum