Electric—and hydrogen fuel cell—vehicle maker Nikola (NASDAQ:NKLA) jumped 6.3% on slightly elevated trading volume yesterday as the company came out with a string of wins in recent days. Analysts are holding their positions or even encouraging a buy, and a recent earnings report that featured a smaller loss than expected left the market with a growing interest in the company once considered a Tesla-killer.
Nikola Earnings Report Features Surprise Wins
The Nikola earnings report provided the company with sufficient fodder for gains over the last few days. The company reported a net loss of $120.2 million for 2021's first fiscal quarter, which on a per-share basis, translated into $0.14 per share lost. Analysts expected a $0.27 per share loss, so this was sufficient for the company to start its upward trending. The loss was wider against last year, however, when the company posted an adjusted loss of $0.12 last year.
The company also recorded no revenue, as it doesn't have a vehicle on the market yet. However, the company expects to start selling Nikola Tre model trucks starting in the fourth quarter. Revenue from Nikola trucks is expected to provide as much as $30 million in sales revenue, though the company expects to only sell between 50 and 100 such trucks.
Further future developments are also slated; within the next few months, the company is poised to start building hydrogen fuel stations, and the company recently secured contracts with Anheiser-Busch (NYSE:BUD) that will feature sales of hydrogen fuel-cell trucks. Additionally, Nikola and Anheuser-Busch InBev will be working together on a prototype fuel-cell truck that will be used in beer deliveries. A recent sort of exhibition drag race between a Nikola Tre Class 8 and a Ford (NYSE:F) F-350 proved the semi could hold its own against conventional vehicles even with a cabin full of people, which might well help fuel interest down the line.
How Do Financial Analysts Feel About NKLA Stock?
While Nikola has had several significant developments, there is still some skepticism from financial analysts, who have rated Nikola stock a consensus “hold”. That “hold” rating has been in place since June of last year, when it was reduced from a consensus “buy”. There are, however, also signs the consensus is shifting.
Back in August of last year, the company had one “buy” rating and three “hold” to its credit. Three months ago, that shifted to two “buy” ratings and six “hold”. Today, we stand at three “buy” and six “hold”, which shows the ratio of “hold” to “buy” narrowing a bit.
Nikola share price targets, meanwhile, have a range that's almost unbelievable to witness. The current average is $29.75, but the lowest target is $13 and the highest target is $79. With Nikola shares currently trading at $12.38, there's quite a bit of upside potential here as even the lowest price target represents a gain. The company's 52-week high of $93.99, however, is likely out of reach for the near-term.
Recent developments have been few and not all that positive for Nikola. Three days ago, Deutsche Bank Aktiengesellschaft lowered its price target on Nikola stock from $19 to $16, though it maintained its “hold” rating. Wedbush cut its price target almost in half back on April 19, going from $25 to $13. However, Vertical Research on April 1 came out with new coverage of Nikola, declaring it a “buy” with a price target of $24.
One further development will likely catch attention; reports note that a Nikola put option was particularly attractive in recent trading. The June 18, 2021 $20.00 Put option, reports noted, represented some of the “highest implied volatility” seen in equity options yesterday.
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