In a note to clients Thursday, analyst Mark Delaney lowered Fisker stock to sell from neutral and trimmed the price target to 10 from 15. Meanwhile, he downgraded Lordstown stock to neutral from buy and slashed the price target to 10 from 21.
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Fisker is planning to launch its Ocean SUV in Q4 of 2022, with mass production coming a year later. It also hopes to follow up with another vehicle made with Foxconn that could enter the market around Q4 of 2023.
Established EV OEMs such as Tesla (TSLA) are also scaling quickly, Delaney wrote. “Several of these companies are committing billions of R&D dollars to both powertrain technology and software,” he said.
Delaney added that while Fisker is taking steps to differentiate its upcoming products such as a new ADAS (advanced driver assistance systems) platform, added range and using recycled materials, the company’s late time to market is a concern.
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Delaney said Lordstown’s plan to be the first mover in the fleet-focused segment of the EV pickup truck market gives it an opportunity to be successful in the long-term.
“However, the company’s recent issues with the Baja race on 4/17 (the vehicle ran out of battery after about 40 miles, albeit on challenging off-road terrain) suggests to us that there could be more development work to do on the powertrain than we had expected,” he wrote.
“This factor, coupled with the global auto supply chain challenges that are making it difficult to obtain parts, could increase the probability that the company’s market entry will be delayed and/or could occur at a more measured pace than we had expected.”
EV stocks have been hit hard amid a market rotation out of growth stocks, but industry leader Tesla has fared better than most.
Follow Adelia Cellini Linecker on Twitter @IBD_Adelia.
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