Nikola Corporation (NKLA): Will the Phoenix fly in the EV sky?

• Phoenix-based Nikola Corporation focuses on developing heavy-duty BEV trucks and fuel cell vehicles. 
• Founded in 2014, started delivery in 2021. 

Nikola Corporation is based in Phoenix, Arizona and was founded in 2014 as an EV manufacturer and alternative energy company. They will begin delivering their first vehicles by 2021. The primary focus is developing heavy-duty battery electric vehicles (BEV) trucks and fuel cell vehicles. 

Also, providing charging facilities for BEV and fuel cell vehicles. The revenue in 2022 was slightly over $18 million. EV purchases in the US managed to be 5.8% of all vehicles sold in 2022, which is up from 3.2% in 2021. 

The company entered the public market through an IPO/merger with SPAC or a special purpose acquisition company. They announced the delivery of their flagship truck, called the Tre, having its delivery to commence in early 2021; they successfully managed to sell 93 units by August. Their share prices dramatically jumped during the IPO, but a scandal in the C-suite adversely affected the rally. 

Founder Trevor Milton was accused and later was found guilty of false statements regarding the upcoming Badger truck and providing inaccurate and inflated vehicles reservations information during his tenure. 

At the time of writing, the stock was trading at $2.61, with a slight drop of 0.76%. While the previous close was at $2.63, and the open was $2.68. The fifty-two-week range is from $2.01 to $11.87, meaning the current price is closer to the lower levels. The market cap is strong at $1.338 billion, with a volume of 15.04 million shares and an average volume of 13.26 million shares. 

The expected price target is around $8.83 with an upside of 220.9%, while the higher point could be $10.00 and the lower point could be $5.00. The projected earnings growth is from $1.96 to $1.41 per share. The upcoming earnings date is February 23, 2023, while the company’s revenue is $44.26 million, and revenue per share is around $0.10. 

The analysis shows a breakthrough from the short-term, downward trend line. But the lack of proper follow-up indicates more sellers in the market than buyers. Meaning that even though the collective movement is towards the north, it can go south anytime.  

The latest movement brings the price down closer to the demand zone; the price would consolidate for some time before deciding any direction to move on. Unless a piece of very positive news hits the market, there is a limited possibility that the price will break the supply zone. 

Disclaimer:

The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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