TLDRQuantumScape (QS) ended its nine-day winning streak with a 14.48% drop to $12.52 on Monday as investors took profits ahead of Q2 earningsThe stock had surged 114% during the nine-day rally to reach new all-time highs before the pullbackQ2 earnings are scheduled for Wednesday, July 23, with analysts expecting a loss of $0.21 per shareThe company recently announced its new Cobra separator production process, offering 25x faster heat treatment speed than the previous Raptor processOptions traders are expecting a 17.33% move in either direction following the earnings announcementQuantumScape’s remarkable nine-day winning streak came to an abrupt halt on Monday. The stock plummeted 14.48% to close at $12.52 as investors cashed in on gains.The selling pressure came after the stock had climbed an impressive 114% during its winning streak. That run pushed shares to new all-time highs before Monday’s reversal.Monday’s decline appears to be classic profit-taking behavior. Investors are repositioning their portfolios ahead of the company’s second-quarter earnings report scheduled for Wednesday, July 23.Wall Street analysts expect QuantumScape to report a loss of $0.21 per share for Q2. That would represent an improvement from the $0.25 loss per share reported in the same quarter last year.The company isn’t expected to generate meaningful revenue yet. QuantumScape remains in the pre-commercial stage as it develops its solid-state lithium-metal battery technology.Despite the lack of revenue, investors will focus on other key metrics. Updates on battery testing progress and factory development will be closely watched.Any news about potential deals with automakers could also move the stock. These partnerships are crucial for the company’s long-term commercialization plans.QuantumScape Corporation (QS)New Production Process Drives Recent RallyThe recent surge in QuantumScape’s stock price was largely driven by news from last month. The company announced it had begun using a new production process called Cobra.This new method represents a major upgrade from the previous Raptor process. Cobra offers approximately 25 times faster heat treatment speed.The new process also requires much less physical space per film start. This efficiency improvement is critical for designing scalable gigafactory production lines.The Cobra separator is designed to enable faster and more energy-efficient production. It also has a smaller equipment footprint compared to earlier processes.William Blair analyst Jed Dorsheimer maintained his Market Perform rating despite the Cobra announcement. He noted the update was positive but already expected by the market.Dorsheimer said he wants to see more concrete developments before becoming more bullish. Specifically, he’s looking for details about the company’s first customer and battery production costs.High Volatility Expected After EarningsOptions traders are bracing for major price swings following Wednesday’s earnings report. The options market is pricing in a 17.33% move in either direction.This level of expected volatility reflects the uncertainty surrounding the company’s progress. Investors are clearly divided on QuantumScape’s near-term prospects.TipRanks’ AI stock analysis has assigned a Neutral rating to QuantumScape shares. This reflects the mixed sentiment among market participants.Wall Street analysts maintain a Hold consensus rating on the stock. The rating is based on one Buy and four Hold recommendations issued in the past three months.The average price target stands at $6.33 per share. This implies a potential 49.44% downside from current levels.Monday’s profit-taking move brought some balance back to what had been an extremely one-sided rally. The stock’s recent volatility underscores the speculative nature of pre-revenue technology companies.The post QuantumScape (QS) Stock Takes a Breather Following Its Epic Nine-Day Run appeared first on Blockonomi.