The company named Daniel Ninivaggi as its new CEO Thursday morning, effective immediately. Lordstown (ticker: RIDE) shares were up 20% to $6.64 in premarket trading. S&P 500 and Dow Jones Industrial Average futures were roughly flat.
Ninivaggi takes over from board chair Angela Strand, who ran the company after the departure of Steve Burns in June. Burns left shortly after the company received a “going concern” warning from its auditor. That warning, essentially, means the company might not have the capital required to keep operating without a significant change.
Lordstown stock hit a 52-week low on Aug. 19. Shares have rallied off the bottom and, including Thursday’s premarket gains, are up almost 25% from a nadir of $4.77 a share.
Ninivaggi is the former CEO of Icahn Enterprises (IEP) and has served in a “variety of senior leadership positions in the automotive and transportation industries,” according to the company. His previous automotive jobs include stints at parts suppliers Lear (LEA) and Federal-Mogul. He also serves on the board of Garrett Motion (GTX), the turbocharger business spun out of Honeywell International (HON).
“I believe the demand for full-size electric pickup trucks will be strong and the Endurance truck…has the opportunity to capture a meaningful share of the market,” said Ninivaggi. The Endurance, Lordstown’s first product, is due to start production in the coming months. “I look forward to working with the talented Lordstown management team, our suppliers and other partners to bring the Endurance to market and maximize the value of our assets.”
Ninivaggi will have a tough job. Wall Street has soured on Lordstown stock. Only one out of eight analysts, or 13%, rates shares Buy. The average Buy-rating ratio for small-capitalization stocks is about 60%. What’s more, 50% rate shares Sell. The average price target of the sell-rated analysts is about $1.55 a share.
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