Frantic VinFast trading has raised eyebrows but the stock is still a long way from becoming a meme. The market cap of the Vietnamese electric car maker briefly surpassed that of some world-famous automakers, such as Ford and GM. Stocks had risen almost 700% in the two months since they went public through a SPAC (special purpose acquisition company) mid-August. The market cap briefly reached $85 billion. It was easy to come and easy to go. VinFast, after a six-day streak of unimaginable success, has dropped 60% this week. This brings its gains from its debut on the market to around 170%. According to Marco Iachini of Vanda Research, there has been a growing interest in VinFast from retail crowds, but the company pales in comparison to other popular Asian automakers at their peak, such as Nio. Iachini stated that, “While VFS is receiving more news coverage, I am not confident this stock will reach the popularity of Chinese carmakers in late 2020/early 21.” VinFast, the short-lived rally of No Meme Stock, is similar to the trading frenzy that occurred last year for AMTD Digital. This little-known Hong Kong fintech company saw its stock rise more than 20,000% within two weeks. The stock has dropped to $5.60 per share, almost 30% below its $7.80 initial public offering price. Since the GameStop mania in 2021, when a group of Reddit-obsessed investors were able to drive up the shares of the videogame retailer and squeeze short selling hedge fund, wild trading has become a common occurrence. According to Quiver Quantitative, VinFast ticker VFS was not among the top ten most mentioned on Reddit WallStreetBets over the last 30 days. VinFast was listed on Nasdaq in August 2015 after merging with Black Spade Acquisition. SPACs are companies that raise capital through an IPO, and then use the money to merge with a privately held company within two years. In the last year, as interest rates soared and regulatory pressure increased, the SPAC market has dried up. The automaker is yet to turn a profit. The automaker delivered its first vehicles to U.S. customers in March, several months after the December deadline. Alex Harring, CNBC’s reporter, contributed to this report.
