On Twitter, @swawyermeritt posted on “X” that VinFast became the world’s third-most valuable automaker today after its stock rallied 20%. Despite the company having only sold a little more than 100 cars in America, it now has a market cap of $191 billion, more than Ford, GM, and VW combined.
In recent times, the remarkable upswing in VinFast’s stock valuation has caught the attention of investors and enthusiasts alike. This surge is particularly intriguing given the relatively modest number of cars the company has managed to sell up to this point. There exist a number of plausible reasons that contribute to this phenomenon:
- Limited Float of Available Shares: VinFast’s decision to make just 1% of its shares available to the public has resulted in a scarcity of tradable shares. This scarcity, in turn, can amplify the volatility of the stock price. Even minor transactions can wield a substantial influence on the overall valuation.
- Enthusiasm for Electric Vehicles: The global landscape for electric vehicles is rapidly expanding, and VinFast is emerging as a prominent contender in this arena. The excitement surrounding this sector is compelling certain investors to acquire VinFast’s stock, despite the company’s nascent stage of development.
- Ambitious Growth Blueprints: VinFast’s aspirations for expansion in the United States and European markets are substantial. The establishment of a manufacturing facility in North Carolina, set to commence operations in 2024, and the target of selling 1 million cars annually by 2028 underline these ambitious goals. This drive toward growth further contributes to the buzz encircling VinFast’s stock.
It is essential to acknowledge that VinFast is a relatively youthful enterprise and has not yet achieved profitability. As a result, the trajectory of the stock price may experience downturns if the company falls short of its anticipations. Nonetheless, the recent surge in stock value alludes to the optimism investors harbor about VinFast’s future prospects.
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The unfolding years will be the ultimate judge of whether VinFast can translate this momentum into sustained success. While the journey ahead remains uncertain, the company’s auspicious beginnings position it as a captivating entity warranting close observation.