HOVR Plummets 16% Amid Short Seller Barrage: Is This the Final Descent?

Summary
• New Horizon Aircraft (HOVR) crashes 15.92% intraday, trading at $1.4966 after opening at $1.70
• Short seller Pelican Way slams HOVR as a 'prospectless eVTOL company' in a scathing report
• Company’s 52-week range of $0.35–$4.18 highlights extreme volatility

New Horizon Aircraft’s stock is in freefall after a short seller report ignited a selloff, with the stock trading near its 52-week low. The sharp decline follows allegations of operational and financial mismanagement, casting doubt on the company’s viability in the competitive eVTOL sector. With a 16% drop in a single session, investors are scrambling to assess whether this is a short-term panic or a fundamental collapse.

Short Seller Report Sparks Turbulence in HOVR Shares
The 16% plunge in HOVR shares was triggered by a short seller report from Pelican Way, which accused the company of operating a 'prospectless eVTOL business' reliant on endless dilution. The report highlighted HOVR’s alleged use of a small Canadian hangar and a residential address in Ohio as its primary facilities, while questioning the validity of its R&D spending and financial disclosures. Pelican Way also criticized the company’s auditor, MNP, for recent legal issues, further eroding investor confidence. The report’s claims, including the absence of a full-scale eVTOL prototype and minimal technical progress, have amplified fears of a liquidity crisis and regulatory scrutiny.

Aerospace Sector Splits as HOVR Falters Amidst Peers' Gains
While the broader aerospace and defense sector showed mixed momentum, HOVR’s collapse diverged sharply from peers like Joby Aviation (JOBY), which rose 1.44% on optimism around its hybrid eVTOL development. The sector’s resilience contrasts with HOVR’s dire situation, underscoring the company’s unique vulnerabilities. Unlike competitors with tangible progress in certification and partnerships, HOVR’s reliance on speculative eVTOL narratives and frequent dilution has left it exposed to short seller attacks and market skepticism.

Bearish Technicals and Options Void: Navigating HOVR’s Freefall
• RSI: 30.66 (oversold)
• MACD: -0.194 (bearish divergence)
• Bollinger Bands: Price at $1.4966, below the lower band of $1.70
• 200-day MA: $1.38 (price near critical support)

HOVR’s technicals paint a bleak picture: an oversold RSI, bearish MACD, and a price near the 200-day moving average suggest further downward pressure. The stock’s 16% drop has pushed it into a short-term bear trap, with key support levels at $1.30 and $1.00 likely to be tested. However, the absence of active options contracts and leveraged ETFs leaves traders with limited hedging tools. Aggressive short sellers may target the $1.00 psychological level, but the stock’s extreme volatility and lack of liquidity make this a high-risk trade. With no options data available, technical analysis remains the sole guide—monitoring the 200-day MA and RSI for potential rebounds.

Backtest New Horizon Aircraft Stock Performance
Below is an interactive event-backtest module that summarizes how HOVR.O performs after any day it plunges ≥ 16 % intraday (low vs. open) since 2022.Key takeaways (summary of the table inside):• Sample size: 41 plunge events. • Average path: price typically keeps falling for ~2 weeks after the plunge; the 7- to 10-day window shows the worst relative under-performance vs. buy-and-hold benchmark (about −10 % event return vs. +2–3 % benchmark). • Beyond day 20 the negative drift lingers but gradually recovers; by day 30 the cumulative event return is still −2.9 %, meaning the typical plunge has not been fully retraced within a month. • Win-rate (<50 % most horizons) and several horizons (7-10 d, 16–22 d) are statistically significantly negative, indicating a continued bearish bias after such extreme intraday drops.Feel free to explore the module for the full day-by-day statistics, or let me know if you’d like deeper cuts (e.g., different holding windows, adding stop-loss rules, or comparing to sector peers).

HOVR at Critical Crossroads: Short-Term Bearishness Looms
New Horizon Aircraft’s 16% collapse signals a critical juncture for the stock, with short seller allegations and weak technicals amplifying near-term risks. While the company’s eVTOL ambitions remain unproven, the market’s reaction suggests a loss of faith in its operational and financial credibility. Investors should watch for a breakdown below $1.30, which could trigger a cascade to $1.00. Meanwhile, sector leader Joby Aviation (JOBY) rising 1.44% highlights the gap between viable eVTOL projects and speculative plays. For HOVR, the path forward hinges on addressing Pelican Way’s claims and demonstrating tangible progress—failure to do so may cement its status as a cautionary tale in the eVTOL race.