On Thursday, shares of Nikola soared as much as 31 percent during trading. The jump followed the management team’s comments that production targets were still being met despite sexual assault allegations made against Nikola Founder Trevor Milton. Two females have accused the young billionaire of sexual abuse during their teen years.
Hindenburg Research, a forensic financial research firm, also accused the hydrogen-powered truck company of fraud in September. The allegation prompted the Securities and Exchange Commission and the Department of Justice to investigate Nikola of securities fraud. Milton has since exited the company and, in the meantime, has denied the allegations of fraud and sexual misconduct and refused to discuss the matters further.
Hindenburg’s accusations have led to investor doubt of seeing the GM deal finalized. Initial targets were set for the deal to close before the beginning of October. However, current Nikola CEO, Mark Russell, said the companies are still in discussion over the deal, which would give GM a stake of 11 percent in Nikola in exchange for supplying fuel cell and battery technologies. GM would also produce the Badger pickup for Nikola.
The company said that its factory plans and production timeline remain on track to meet its targets. Between the allegations and a planned deal with GM, there’s been widespread anxiety among investors.
Still, on Thursday, shares were full speed ahead, up to 31 percent, before falling and closing with a 17.7 percent gain. Overall, shares have fallen 37 percent over the past month.