Fuel-cell electric vehicle (FCEV) manufacturer Nikola (NASDAQ:NKLA) saw its shares pop higher following better-than-expected results for its second-quarter earnings report. In addition, the company is progressing toward its goal of restoring its battery EV business following a recall last year. Nevertheless, NKLA stock faces significant challenges in its bid to regain credibility.
Earlier Friday, Nikola disclosed encouraging results for Q2, posting a loss per share of $2.67. This figure compared favorably to the expected loss of $2.76. On the top line, the company reported sales of $31.32 million. This metric exceeded the consensus view of $24.70 million by 26.8%.
In the year-ago quarter, Nikola posted a loss of $6 per share, which also came in favorably relative to the expected loss of $6.60. At the time, the FCEV specialist also posted $15.36 million in revenue. Again, this metric came in above analysts’ estimate, which called for $14.99 million.
Despite steady financial progress, NKLA stock continues to flounder. Since the beginning of the year, shares dropped about 66% in the charts. Over the past 52 weeks, Nikola surrendered more than 85% of its market value.
Here are three things to know right now about NKLA stock earnings.
Vehicle Deliveries a Key Highlight in NKLA Stock Earnings
According to Seeking Alpha, Nikola stated that it rose above the upper end of its guidance range through the delivery of 72 commercial FCEVs to its dealer network in Q2. Management also noted that in the first three quarters of serial production, the company manufactured 147 wholesaled vehicles. Currently, Nikola represents the only original equipment manufacturer (OEM) with Class 8 FCEVs that are commercially available in North America.
Nikola Returning Back to BEVs
Last year, Nikola recalled 209 commercial battery electric vehicles (BEVs) to complete repairs on the underlying battery packs. The recall was in response to multiple battery fires.
Per Seeking Alpha, Nikola remarked that it is making progress in returning BEVs to its dealer network and end fleet users. “We remain on track to complete the recall program by year-end 2024,” management stated. Significantly, Nikola customers expressed strong satisfaction with the returned vehicles and over-the-air updates.
Analysts Are Surprisingly Bullish on NKLA Stock
Despite the severe loss of value and hefty financial risks (including ongoing debt issuance), Wall Street analysts are still bullish on NKLA stock. According to TipRanks, covering experts rate shares a consensus moderate buy. This assessment breaks down as two buys, four holds and, surprisingly, no sells. The average price target stands at $22.80, implying over 168% upside potential.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor held a LONG position in NKLA.
