Workhorse had expected to deliver 1,800 vans this year. The number is now 1,000.
Courtesy Workhorse
Commercial electric vehicle maker Workhorse investors have had a rough ride so far this year. And a slashed production outlook by management coupled with a larger-than-expected quarterly loss is rattling their confidence even more.
On Monday, Workhorse (ticker: WKHS) reported it lost roughly $1 a share from $521,060 in sales. Wall Street projected a 17-cent loss from $2.3 million in sales.
Shares were are down about 12% in morning trading. The S&P 500, is down about 0.1%. The Dow Jones Industrial Average was up 0.7%. Coming into Monday, Workhorse stock is down 51% year to date after rising 551% in 2020.
The loss was larger than expected because of a mark-to-market loss on the company’s holding of Lordstown Motor (RIDE) stock. Workhorse owns about 10% of Lordstown, according to recent filings, and Lordstown shares dropped about 41% in the first quarter.
The sales number isn’t all that surprising, either. Workhorse is just beginning to produce its all-electric delivery vans. Analysts expected sales to ramp higher in the third quarter. Workhorse delivered six vans in the first quarter.
But the company revised its full-year deliveries figure downward by to 1,000 from 1,800 laid out by management on the fourth-quarter earnings call in March. Also discussed were supply-chain problems, including the global semiconductor shortage. Workhorse is getting hit with the lack of chips like other auto makers.
CEO Duane Hughes explained the new goal in the company’s first-quarter statement: “Our deliberate approach to growth will ensure we are well-positioned to deliver the increased volumes we expect in 2022 and beyond.”
Management hosts a conference call later Monday. Analysts and investors will be eager to hear about order expectations as well as anything the company has planned about the U.S. Postal Service contract that it lost to Oshkosh (OSK). Workhorse and Oshkosh bid to replace the agency’s white, right-hand drive delivery vans.
Workhorse hasn’t formally protested the loss, Barron’s reported last week. The Oshkosh win surprised some analysts who believed the Postal Service would opt for Workhorse’s all-electric bid. Workhorse management has said it planned to pursue options to challenge the Oshkosh award.
About 44% of analysts covering Workhorse rate shares Buy. The average Buy-rating ratio for stocks in the S&P 500 is roughly 55%. But recent declines have the stock looking attractive relative to target prices. The average analyst target price is about $17 a share, roughly 78% higher than where the stock is trading.
Write to Al Root at [email protected]
