Polestar Share Price Explained: Polestar Stock Trading Guide

For over a decade, Polestar was initially known for creating high-performance versions of Volvo cars for racing competitions like the World Touring Car Championship. However, in recent years, Polestar has evolved into an independent electric vehicle brand.

This article explores Polestar's electric cars and how it makes money, including Polestar PSNY stock market performance and how to trade PSNY share CFDs.

Main Points:

• Polestar, initially a motorsport partner to Volvo Cars, is now a standalone electric vehicle brand.
• Polestar sells its various models through a multi-faceted sales approach to drive sales growth and diversified revenue streams across various regions.
• In June 2022, Polestar went public on the NASDAQ through a merger with Gores Guggenheim, Inc., a special purpose acquisition company (SPAC).
• Traders can engage in the rising and falling prices of Polestar shares by trading PSNY shares CFDs on the Plus500 trading platforms.

Introduction to Polestar Automotive Holdings UK Plc

Polestar's name is inspired by the North Star, known as Polstjärnan in Swedish and interpreted as "Pole Star" in English. This celestial body has served as a reliable guide for travellers in the Northern Hemisphere for centuries.

By choosing this name, Polestar suggests that they aim to be a guiding force or forerunner for Volvo Car Group, particularly in the realm of electric vehicles.

What Is Polestar?

Polestar is a Swedish automotive manufacturer known for its 'asset-light' approach in developing and manufacturing luxury electric cars. Polestar is under the ownership of Polestar Automotive Holdings UK PLC (a UK-based holding company), which was co-established in 2021 by Volvo Cars (VOLV-A.ST) and its parent company, Zhejiang Geely Holding Group (0175.HK).

Polestar combines modern Scandinavian design, the latest technology, and a strong focus on sustainability to create a new standard for electric vehicles. This approach reimagines the driving experience by emphasising style, innovation, and eco-friendliness.

Polestar headquarters is located in Torslanda, Sweden. While it doesn't own its own manufacturing facilities, it leverages the facilities of its parent companies. As a result, Polestar cars are available to a wide range of consumers across the US, Europe and Asia.

How does Polestar make money?

Polestar primarily generates revenue by selling its electric vehicles and offering customers additional features or upgrades.

As of August 2024, Polestar's product lineup includes:

• 1 Discontinued Model (Polestar 1)
• 3 Active Car Models (Polestar 2, Polestar 3, and Polestar 4)

The company delivered approximately 56,000 vehicles in the first quarter of 2024 and aims to sell between 150,000 and 165,000 vehicles by the end of 2025.

Polestar employs a multi-faceted sales approach, including a direct-to-consumer model, a direct-to-business (fleet sales model), and through importer markets.

To provide a more personalised experience, Polestar has established over 40 spaces across 27 markets in Europe, the US and Asia, where customers can learn about the cars and even take a test drive.

Furthermore, Polestar also offers the option of home delivery, allowing customers to evaluate the vehicle in the comfort of their own environment.

An Overview of Polestar's Products

The History of Polystar Automotive Holdings

Polestar's roots trace back to a Swedish motorsport team called Flash Engineering, founded in 1996. After rebranding to Polestar Racing, the team began customising Volvo's existing models for performance enhancements, eventually leading to a formal partnership in the late 2000s.

During this partnership, Polestar produced a series of high-performance, petrol---and hybrid-powered Volvo-based models, the first of which was the C30 Polestar Concept in 2010.

In a significant turning point, Volvo Cars and Geely Holding announced in 2017 that Polestar would become a standalone brand focused on luxury electric vehicles.

Key milestones in Polestar's journey include:

• The introduction of Polestar 1, a plug-in hybrid grand tourer, launched in 2017.
• The introduction of Polestar 2, the brand's first fully electric vehicle, was unveiled in 2019.
• The Super Bowl Commercial Ad in 2022 helped increase Polestar's visibility.
• Polestar's public listing on the NASDAQ exchange in 2022 through a SPAC merger and capital raise to over $750 million.
• The launch of Polestar 6 in 2026, a future electric roadster based on the Polestar O2 concept.

Polestar Stock Financial Performance

After going public on the NASDAQ, Polestar's shares (PSNY) closed at $13 on its first day of trading (24 June 2022), a 16% increase from the final closing price of the Special Purpose Acquisition Company, Gores Guggenheim, Inc.

Since reaching an all-time high of $16.45 on 15 November 2021, Polestar shares PSNY have declined to around $1 per share as of August 2024.

At around $1 per share, Polestar Automotive Holdings market capitalisation is worth $1.9 billion. The company has outstanding shares of 467.98 million, a public float of $467.67 million and a negative earnings per share (EPS) of $-0.68.

Factors Affecting Polestar Stock Performance

• Innovation and R&D: Polestar's investment in cutting-edge automotive technologies and partnerships with companies like Volvo, Geely, and Nvidia (NVDA) can enhance its market competitiveness and future growth potential.
• Sales Models: Polestar multi-faceted sales approach is aimed at driving sales growth and diversified revenue streams across various regions, although it may sometimes compress profit margins due to high-volume discounts and reliance on importers.
• Capital Structure: The issuance of Class C shares and earn-out rights following the merger with Gores Guggenheim, along with the handling of derivative liabilities, introduces volatility in stock performance due to changes in fair value recognised in financial reports.
• Global Disruption: Supply chain disruptions from COVID-19, the Russo-Ukrainian War, and the conflict in Israel could delay production, increase costs, and affect Polestar's ability to deliver vehicles, impacting stock performance.
• Production: Successful ramp-up of production, especially for new models like Polestar 3 and 4, is crucial for meeting sales targets and maintaining gross margins. Delays or inefficiencies here could negatively affect revenue and profitability.

How to Trade Polestar Share CFDs

Polestar Holdings Automotive is listed on the NASDAQ under the ticker symbolised as 'PSNY'. Its shares can be owned directly or traded as Contracts for Differences (CFD) on CFD providers like Plus500.

CFDs are financial instruments that allow traders to profit or lose from the difference between the opening and closing prices of a long or short position on Polestar stock.

Besides opening long and short positions on Polestar share CFDs, traders can increase their exposure in the underlying instrument by using leverage. However, leverage also poses a risk of amplified losses.

Trading Hours for Polestar (PSNY) Share CFDs

Polestar (PSNY) share price movement can be monitored and traded as CFDs on the Plus500 trading platforms between Monday at 3:30 PM CET and Friday at 10:00 PM CET.

*Please note that trading platform hours may vary depending on the individual operator.

Steps to Buy and Sell Polestar (PSNY) Share CFDs

To trade PSNY share CFDs with Plus500, follow these steps:

1. Signing up for a trading account and login to the trading platform
2. Explore the platform's advanced features and trading tools.
3. Find the Polestar shares 'PSNY' through the instrument category section or the search bar.
4. Analyse the Polestar shares' current market conditions to decide whether to go long or short.
5. Specify the amount of PSNY share CFDs you wish to buy or sell.
6. Input your risk management parameters, such as close-at-loss orders and close-at-profit orders.
7. Click the "Buy" or "Sell" icon to execute your trade.

Conclusion

Being a guiding star for Volvo is a great challenge. Polestar, as a brand, engages more unique customers than Volvo and is determined to make its own mark in the luxury electric car industry. When evaluating trading opportunities with PSNY shares CFDs, traders should monitor the latest headlines related to the electric vehicle industry and factors associated with Polestar shares such as its product releases, sales milestones, and competitive advantage.

If you would like to take long or short positions in Polestar share CFDs, you can start trading PSNY at Plus500.