Tuesday, Nikola Corp . (NASDAQ:NKLA) received a continued Neutral rating from BTIG following an announcement that the company's second-quarter fuel cell electric vehicle (FCEV) deliveries exceeded expectations.
Nikola reported the delivery of 72 units, surpassing the forecasted range of 50-60 units. This performance marks a significant increase from the previous quarter's 40 units, which also topped the guidance of 30-35 units.
The higher-than-anticipated delivery volume for the second quarter suggests potential revenues between $25 million and $28 million, compared to the consensus estimate of approximately $21 million and BTIG's projection of around $19 million. The company's delivery growth is notable, with an approximate 80% sequential increase from the first quarter and about 105% growth from the fourth quarter of 2023.
Nikola's production ramp-up is evident, with around 112 vehicles delivered in the first half of 2024. The company's full-year delivery guidance for 2024 is set at 300-350 units, indicating a potential 20% to 40% sequential growth in the third and fourth quarters, depending on achieving the lower or higher end of the guidance range, respectively.
BTIG anticipates that the delivery expansion will contribute to margin improvements and a reduction in cash burn, which is crucial for the company's financial health.
The firm highlighted the importance of continued execution on production and cost management, as well as maintaining customer demand. Despite the positive trend in vehicle sales, Nikola is expected to maintain discipline in pricing and persist in cost-reduction efforts.
The company aims to lower its annual cash burn to under $400 million, a significant undertaking considering the first quarter's free cash burn was approximately $132 million. BTIG's analysis suggests that while the trajectory for vehicle sales is encouraging and may help alleviate cash burn, Nikola's management must remain focused on execution to sustain this momentum.
In other recent news, Nikola Corporation has exceeded its own sales forecasts, reporting an 80% increase in hydrogen fuel cell truck deliveries for the second quarter. The company successfully delivered 72 Class 8 Nikola hydrogen fuel cell trucks, surpassing its projected range of 50 to 60 trucks.
This surge in delivery marks a positive development for Nikola amid a challenging period, indicating a potentially expanding market for hydrogen fuel cell technology within the heavy-duty trucking sector.
In addition, Nikola Corporation announced a 1-for-30 reverse stock split, set to enhance the corporate structure of the company. This decision will consolidate every thirty shares of issued common stock into one share, affecting all shareholders uniformly.
Nikola also secured a significant order of 100 hydrogen fuel cell electric trucks from AiLO Logistics, marking a substantial move in the trucking industry's shift towards decarbonization.
Still, TD Cowen recently reduced Nikola's stock price target following a disappointing first quarter for 2024. Despite this, Nikola has expanded its hydrogen refueling station network with a new facility in Long Beach, California, under its HYLA brand. These are recent developments in the electric vehicle industry.
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