Faraday Future Stock Is a High-Risk Buy Ahead of Its Investor Day

Critics of Faraday Future Intelligent Electric (NASDAQ:FFIE) are quick to say that “Faraday has no future.” However, while the Faraday Future stock price has fallen right into Wall Street’s junkyard heap, this bleak statement is not entirely accurate. Despite setbacks and heavy losses, Faraday has kept the lights on. It’s not completely out of the running yet, despite being down by a significant margin. That’s not all. Recent EV developments increase the company’s chances of success. As it stands now, even an ounce of operational improvement could go a long way to send FFIE stock back to substantially higher prices. For those with a high enough risk appetite, there may be merit in holding a speculative position. Faraday Future Stock: A New Hope Following Recent EV News Price action with FFIE has calmed down so far in July. However, in late June, Faraday Future shares were making some wild moves. One big reason for this high volatility had to do with Faraday’s NASDAQ delisting saga. As we discussed in prior coverage of Faraday Future stock, the company has been working to maintain its NASDAQ listing, in order to avoid a move down to the over-the-counter market. Becoming an OTC stock would likely lead to further pressure on FFIE’s valuation. The company is not out of the woods yet with this delisting issue. However, it may soon be resolved, via a reverse stock split, as well as by catching up with late quarterly filings. However, alongside promising listing compliance news, something else may have played a role in ginning up new hope for FFIE shares. It all has to do with Volkswagen’s (OTCMKTS:VWAGY) plans to invest up to $5 billion into early-stage electric truck and van maker Rivian Automotive (NASDAQ:RIVN). Following this announcement, Faraday founder YT Jia made an X.com post that suggested, albeit subtly, that this EV upstart could too be the eventual recipient of a large investment from a deep-pocketed strategic advisor. Why it May Not Take Much to Get Back to Full Charge Investors may have hit the brakes on the Faraday Future stock, to the extent that shares now trade at near-zero prices. Nevertheless, the company still has a small chance of getting back to full charge in terms of price action. Yes, it’s a bit of a long-shot that an incumbent automaker suddenly decides to become Faraday Future’s strategic partner. However, other deep-pocketed backers could step up. For instance, late last year, the company entered the Middle Eastern EV market. In the past year, the sovereign wealth funds of Saudi Arabia and Abu Dhabi have made billion-dollar bets on some of Faraday Future’s EV upstart competitors. Hence, it’s not a stretch to say Faraday could secure a similar investment from the region. Attaining a new source of capital could drive a relief rally, even as another capital raise would dilute existing investors. Also, there’s perhaps something else that could really spark another big movement for FFIE. That would be if the company finds a way to monetize its technology, through licensing it to other early-stage EV companies. Again, this is a long-shot, but just another example of how Faraday has options when it comes to making it to tomorrow. Faraday Remains Worthy of a ‘Lottery Ticket’ Wager Don’t get us wrong. With FFIE, assume there’s a good chance that you may end up taking a total loss. If the above potential strategic alternatives fail to pan out, at some point, this company’s cash will run out, followed inevitably by a bankruptcy filing. However, if the EV maker avoids having a “game over” moment, experiencing even just a slightly less bleak “future” could lead to big gains for those willing to stomach the risk. Later this week, the company is holding an “Investor Community Day.” The jury’s still out whether this will spark the next big rally for Faraday Future stock. Still, from the event, new potential catalysts may emerge to strengthen this stock’s “lottery ticket” appeal. Faraday Future stock earns a B rating in Portfolio Grader. On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article. On the date of publication, the responsible editor did not have (either directly or indirectly) and positions in the securities mentioned in this article. Consumer Discretionary, Automotive, Electric Vehicles