Vector Acquisition Corporation

Vector Acquisition Corporation (NASDAQ: VACQ) is a blank check company. It focuses to identify, acquire and operate a business in the technology and technology-enabled services sector.

Key highlights

• The Company has no operations and has not generated any revenues. As on March 31, 2021, the company reported negative Cash Flows from Operating Activities of USD 23.5 million.
• Merger with Rocket Lab: Rocket Lab USA, Inc., a global leader in launch and space technologies, and Vector Acquisition Corporation announced that they have reached a final merger agreement, resulting in Rocket Lab becoming a publicly traded company. The acquisition is expected to close in Q2 2021, and Vector would change its name to Rocket Lab USA, Inc. at that time, and the combined company will trade under the Nasdaq ticker symbol RKLB.
• Furthermore, the company is under investigation from various agencies, concerning potential violations of the federal securities laws and/or breaches of fiduciary duties related to merger with Rocket Lab USA.

Financial overview as on March 31, 2021

Source: Company

• The company has not reported any revenue and on the back of formation and operating cost it witnessed a loss from operations at USD 1.93 million as on March 31, 2021.
• The net loss in the reported period stood at USD 23.5 million, mainly due to change in fair value of warrant liabilities.

Stock recommendation

On the daily price chart, the stock has fallen below the crucial support levels. The prices closed below the 21-day and 100-day SMA, indicating a bearish trend. Moreover, the stock would be delisted from the exchange, once the proposed merger got complete. Hence, considering the aforementioned facts, we recommend a “Sell” rating on the stock at the closing price of USD 10.40 on July 15, 2021. 

One-Year Technical Price Chart (as on July 15, 2021). Source: REFINITIV, Analysis by Kalkine Group 

Property Solutions Acquisition Corp.

Property Solutions Acquisition Corp. (NASDAQ: PSAC) is a blank cheque company formed for the purpose of merger, acquisition, asset acquisition, stock purchase of similar or other business combination with one or more business entities.

Key Highlights:

• Stock Price breached key support levels: The stock of PSAC closed below the key support levels of the simple moving average of 50-days and 100-days, respectively, indicating a bearish price trend.

• Update on the proposed acquisition: The company announced its possible acquisition of FF Intelligent Mobility Global Holdings Ltd. (Subsidiary of Faraday Future) in January 2021 and received approval from the majority of stockholders of PSAC. FF Intelligent is an intelligent mobility ecosystem company, which intend to create a shared intelligent mobility ecosystem that enables everyone new generation interconnection platform for Electric Vehicles.

Q1FY21Financial Highlights:

• PSAC announced its first quarter FY21 results, wherein the company posted operating and formation costs of USD 0.88 million.
• The company reported a net loss of USD 1.82 million due to a change in fair value of warrant liability amounting to USD 0.96 million, partially offset by an income from interest earned on marketable securities, amounting to USD 0.030 million.
• The company reported total current assets of amounting to USD 0.22 million while total assets were reported at USD 230.158 million.

Q1FY21 Income Statement Highlights (Source: Company Report)

Stock Recommendation:

The group received a positive response from its shareholders for the proposed merger with Los Angeles-based Faraday Future and is expected to close the deal in July 2021. However, technical indicators are suggesting weakness in the stock price. Moreover, the stock would be delisted from the exchange once the proposed merger got complete. Hence, considering the aforementioned facts, we recommend a ‘Sell’ rating on the stock of PSAC at the closing price of USD 12.40 on July 15, 2021.

One-Year Technical Price Chart (as on July 15, 2021). Source: REFINITIV, Analysis by Kalkine Group

*The reference data in this report has been partly sourced from REFINITIV.