Nikola (NKLA:NSD) Deliveries Disappoint as Shares Drop

Nikola Deliveries Dropped

Nikola Corp, an automaker focused on developing and producing electric and hydrogen-powered commercial vehicles, missed its revenue targets for the fourth quarter of 2022 by a wide margin. The company reported revenue of $6.6 million for the quarter, significantly lower than analysts’ estimates of $32.1 million, according to data from Refinitiv.

The company’s shares dropped 8% after it reported that it had produced 133 trucks but had only delivered 20 vehicles to dealerships during the quarter. The CEO, Michael Lohscheller, attributed the gap to improvements made to trucks in dealer inventory before being sent to customers.

In a positive move, Nikola announced plans to increase deliveries and reduce costs in 2023. The company expects to deliver between 250 and 350 Tre battery electric trucks this year, compared with 131 deliveries in 2022. It also plans to start installing an automated battery pack assembly line, which it anticipates will deliver cost savings of about $105,000 for each Tre BEV truck by the fourth quarter of the year.

However, Nikola also reported that it expects a negative gross margin of 75% to 95% for 2023, which is a significant reversal from its previous forecast of a positive gross margin on its Tre battery electric truck this year. The company reported a net loss of $222.1 million for the quarter, up from $158.9 million a year earlier. Its cash and cash equivalents at the end of the fourth quarter were $233.4 million, down from $497.2 million a year earlier.

Like other loss-making US startups, including Lordstown Motors Corp, Nikola has been facing challenges associated with ramping up production and seeking to establish a foothold in the competitive commercial vehicles market.

According to the average of four analysts’ forecasts, the average target price for Nikola Corp over the next 12 months is USD 7.83, which represents a significant increase from the current stock price of USD 2.33. The average analyst rating for Nikola Corp is Strong Buy, which suggests that analysts have a positive outlook on the company’s prospects.

However, Stock Target Advisor’s analysis of Nikola Corp is Slightly Bearish, based on 3 positive signals and 6 negative signals. This indicates that while some indicators are positive, there are more negative signals that suggest a bearish outlook.

Over the past week, Nikola Corp’s stock price has decreased by 12.73%, which is a significant decline. Over the past month, the stock price has decreased by 7.54%, and over the last year, the stock price has decreased by 68.47%. This suggests that the company has faced significant challenges and has not been able to meet investors’ expectations, which has resulted in a significant decline in its stock price.

 

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