A Fisker Ocean electric sport-utility vehicle.
Bridget Bennett/Bloomberg
Electric-vehicle start-up Fisker is having an epic week. A tech stock selloff, an EV stock selloff, new business partnerships, and fourth-quarter earnings all slammed into Fisker investors over the past few days. It was a lot to take in.
As the dust settles, Wall Street appears more bullish on Fisker (ticker: FSR) than it was a few days ago.
Coming into Friday, the Nasdaq Composite, home to many highly valued tech stocks, was down more than 5% for the week. That’s because inflation fears are rising. Higher inflation means higher interest rates, which hurt highflying stock valuations more than other shares.
Many EV stocks are highly valued. Tesla (TSLA) trades for very roughly 100 times estimated 2022 earnings. Tesla shares have had it harder than the Nasdaq, falling almost 13% through Thursday.
Fisker stock, however, is up 20%. Shares jumped almost 40% after the company announced a new partnership with Foxconn Technology (2354.Taiwan), to produce a new Fisker vehicle together. That blockbusting announcement came Wednesday.
The company’s fourth-quarter earnings report followed on Thursday evening. Fisker isn’t generating sales right now, so earnings don’t matter all that much. Still, it was a chance for analysts to ask about recent developments.
“We like the [Foxconn] deal as it diversifies Fisker away from its sole reliance with Magna producing vehicles in Austria,” wrote Cowen analyst Jeffery Osborne in a Friday research report. Magna (MGA) is building the Fisker Ocean, due in 2022.
Osborne rates FIsker shares Buy. He increased his price target for the stock Friday to $29 from $22. Morgan Stanley analyst Adam Jonas rates share Buy, too. He is more bullish than Osborne and increased his target price to $40 from $27. Jonas believes the potential for a mass-market EV produced with Foxconn is a material, positive change to the company’s outlook.
Raymond James analyst Pavel Molchanov is a little more cautious. He rates Fisker shares Hold. His doesn’t have a target price for the stock. Molchanov is cautious on the stock because he wants more detail from the company about battery supply.
“The ideal outcome would be a firm, multiyear supply contract with a top-tier supplier,” wrote Molchanov in a Friday research report. He also wants more detail about the versions of the Fisker Ocean represented by the company’s 12,000-plus reservation figures. He notes that the gross-profit-market guidance for the base Ocean model is 5%-8%, while the guidance for the Extreme version is 29%-33%.
Overall, four out of seven, or about 57%, of analysts covering Fisker rate shares Buy. The average Buy-rating ratio for stocks in the Dow Jones Industrial Average is about the same.
Fisker shares are down 0.8%, at $21.41, in early trading Friday. The S&P 500 is down 0.2%.
Write to Al Root at [email protected]
