VinFast (VFS, Financial) experienced a significant stock movement today, soaring by 12.2%. This surge is primarily attributed to the company's impressive electric vehicle (EV) delivery figures. Investors are optimistic about VinFast's ability to capture market share in the growing EV sector.
VinFast reported an impressive delivery of 21,912 EVs in the third quarter, marking a substantial 116% increase year-over-year and a 66% rise compared to the previous quarter. Notably, in September, VinFast delivered over 9,300 vehicles in Vietnam, outpacing international competitors and securing its position as the market leader—an unprecedented achievement for a Vietnamese EV company.
Despite this growth, VinFast's stock valuation paints a complex picture. The current price of VFS stands at $4.23. The company has notable financial challenges, including a GF Value of "No Data: Cannot Be Evaluated" due to poor financial health. The company displays severe financial indicators such as an Altman Z-Score of -3.33, signaling distress. This distress suggests a potential bankruptcy risk in the next two years, which should be a concern for investors.
Moreover, VinFast has displayed financial weaknesses, issuing new long-term debt amounting to VND 4.6 billion over the past three years, while operating income shows a loss in 92% of the last twelve quarters. The company's financial strength is regarded as poor, with a cash-to-debt ratio of only 0.03, indicating limited liquidity.
Investors are advised to weigh these financial conditions against the company's recent operational achievements. The next opportunity to gauge VinFast's financial health will be the release of its third-quarter financial results, set for Tuesday, Nov. 6, which may provide deeper insights into the company's long-term viability and growth strategies.
