It’s been two months now since we last wrote about IDEX, which you can read here. IDEX closed that day at $.84 a share. Since then, IDEX has been stuck between $.80 and $1 with a few brief spikes above $1. We told our subscribers that IDEX was still a good play, but that we needed to see a sustained move above $1 confirmed by volume.
Last week, we finally got the confirmation we’ve been waiting for. We believe that everything has finally come together for IDEX to make a run just like SOLO has. Matter of fact, we will admit that we failed to capture the move in SOLO as we never bought into the SOLO story. For those that bought into SOLO, the best bet is to sell SOLO and buy into IDEX because IDEX is a much better company and has yet to make the move.
As you can see from the chart above, SOLO has been on an epic run. The best part about IDEX is that the chart for IDEX is similar to SOLO before its big run.
In this article, we lay out the bull case for IDEX and why we believe Ideanomics is gearing up to be one of the biggest runners as we head into 2021.
First up, here’s a little background for the newbies looking at IDEX for the first time.
Ideanomics is a global company that facilitates the adoption of commercial electric vehicles and supports next-generation financial services and fintech products. Its electric vehicle division, Mobile Energy Global (MEG), provides group purchasing discounts on commercial electric vehicles, EV batteries, and electricity, as well as financing and charging solutions.
Ideanomics Capital provides fintech services that include intelligent and innovative solutions powered by AI and blockchain. Together, MEG and Ideanomics Capital provides its global customers and partners with more efficient solutions for a greener economy.
The company is headquartered in New York, NY, with offices in Beijing, Guangzhou, and Qingdao, and operations in the U.S., China, Ukraine, and Malaysia.
Medici Motor Works
The company’s Medici Motor Works division is set to unveil 6 new electric vehicles next month. For anyone in NIKOLA, they should instead be invested in IDEX with its $286 million market cap instead of Nikola’s $10 billion market cap.
Mobile Energy Global (MEG)
For the period starting October 1, 2020, through October 31, 2020, MEG delivered a total of 102 units, all of which were taxi/ride-hailing vehicles. The 340 units that were invoiced during July through September 2020 are still pending expected delivery.
During the month of October, China had two major national holidays overlap, which resulted in fewer business days. As a result, it was expected to be a lower delivery volume month.
Q4 is where the company will shine. We are expecting big sales numbers for November and December.
IDEX Invests In Soletrac
IDEX first acquired 15% of California-based Soletrac in October. Solectrac develops, assembles, and distributes 100% battery-powered electric tractors—an alternative to diesel tractors—for agriculture and utility operations.
Through a follow-on investment of an additional $1.3M, Ideanomics increased its stake in California-based Solectrac thereby taking total ownership to 24%; post-money once the additional third-party investment is finalized stake will reduce to ~22%
With this investment in Solectrac, Ideanomics expands its global footprint in the electric vehicle (EV) industry, specifically in the category of specialty commercial vehicles. This investment marks its first in an existing US-based OEM, and Ideanomics will assume a seat on Solectrac’s Board of Directors.
Electric tractors are all set to disrupt the $75B global agricultural tractor industry.
Ideanomics owns 51% of Treeletrik, a Malaysian-based EV manufacturer whose business is primarily in logistic vans, mopeds, and scooters. As the China EV market matures, its manufacturers will face oversupply issues. This is where Treeletrik comes in.
IDEX Buys Timios
IDEX just acquired 100% of privately held Timios Holdings Corp. in an all-cash deal. Timios currently has 285 employees and operations in 44 states and has booked over $60 million in YTD revenues, including over $8 million in October 2020.
A strategic acquisition, Timios becomes one of the cornerstones of Ideanomics Capital, delivering innovative fintech solutions to the U.S. real estate industry. The acquisition is in line with Ideanomics’ core ethos of participating in the convergence of fintech and industries that are both in transition and have high barriers to entry.
Ideanomics utilizes an S2F2C “Sales to Financing to Charging” Model: Sales – facilitating group purchasing by offering fleet operators discounts on large unit orders. Financing – helping fleet operators secure financing to purchase EVs.
Ideanomics will benefit from increased charging (electricity) demand from commercial and passenger EVs – more EVs equals more potential consumers requiring its clean electricity charging solutions.
The transition to cleaner and more efficient transportation is a global imperative. This trend cannot be stopped and it will propel Ideanomics stock higher. California announced that it will ban the sale of all new gas-powered cars in 2035.
IDEX Q3 Results
Revenue for the three months ended September 30, 2020, was $10.6 million, of which $10.1 million were generated by the Company’s MEG business unit; this represents the largest revenues earned by MEG since the Company commenced business.
Gross profit for the three months ended September 30, 2020, was $0.7 million, as compared to gross profit in the amount of $2.9 million during the same period in 2019.
IDEX finished the quarter with $27.6 million in cash.
SOLO Q3 Results
SOLO reported total revenue in the third quarter of 2020 was CAD$0.3 million, compared to CAD$0.2 million in the same year-ago quarter.
$SOLO is a COMPLETE JOKE. tgt $2 Where other EV might be overvalued, this is laughable. Under $6 mil R&D last 12 months and 6 cars delivered in 2 years this stock will be the first to trade back to $2 when frenzy over. Nothing here..company run out of an apartment building.
— Citron Research (@CitronResearch) November 20, 2020
We see IDEX taking one or more of its EV divisions public via IPO or SPAC. This makes a lot of sense as there are two divisions – electric vehicles and fintech. At current levels, both divisions are tremendously undervalued.
Ballard Power Link
Ideanomics just hired Dr. Liqing Hu as Chief Scientist for Medici Motors Works. Dr. Hu will be based in China. Dr. Liqing Hu is a celebrated innovator and pioneer in the field of hydrogen energy in China. He completed his post-doctoral research in China, then worked for Ballard Systems in Canada before returning to China.
2 Billionaires Invested
The Chairman of Ideanomics is Chinese billionaire Bruno Wu and Vice-Chairman is billionaire Shane McMahon of the WWE. Insiders own 24% of the company.
IDEX Bottom Line
IDEX has a market cap of just $286 million. The company just acquired Timios, which posted $8 million in revenue for October and $60 million YTD. We see IDEX as significantly undervalued, especially when you compare IDEX to other EV players like SOLO and NKLA. With over 10% of the float short, we are expecting an epic short squeeze. Buckle up and enjoy the ride as the bears and shorts are about to get crushed.
As always, good luck to all (except the shorts)!
WHEN INSIDER FINANCIAL HAS A STOCK ALERT, IT CAN PAY TO LISTEN. AFTER ALL, OUR FREE NEWSLETTER HAS FOUND MANY TRIPLE-DIGIT WINNERS FOR OUR SUBSCRIBERS. WE SPECIALIZE IN FINDING MOMENTUM BEFORE IT HAPPENS!
Disclosure: We have no position in NASDAQ:IDEX or any of the securities mentioned. We wrote this article ourselves and it expresses our own opinions. We are not receiving compensation for it. We have no business relationship with any company whose stock is mentioned in this article. Insider Financial is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. This article is not a solicitation or recommendation to buy, sell, or hold securities. This article is meant for informational and educational purposes only and does not provide investment advice.
Image courtesy of Ideanomics