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Tuesday, October 20, 2020

Nikola Corporation (NASDAQ:NKLA) is Waving the Bear Flag

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Nikola Corporation (NKLA) shares are trading at lower $19.10 and the avg recommendation for the stock is Moderate Buy, while the current analyst price target stands at $55.75.

To add more color to this target, the company’s high over the last year is $93.99 and the low is $10.20. Over the last 52 weeks, NKLA is up 88.55% while the S&P 500 is up 8.70%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, NKLA reported a profit of $6000.0. Nikola Corporation also saw revenues increase to $36000.0. In addition, NKLA has free cash flow of -$52.09 million as of 06-2020. The company’s EBITDA came in at -$86.64 million which compares well with its peers.

NKLA Return on Equity (ROE) is -34.00%, and its Return on Assets is -32.40%. All told, it is clear that, NKLA needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. NKLA has a short ratio of 0.35 and outstanding shares of 303.79M.

Company Outlook

NKLA has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 52.89 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at -0.41. Nikola Corporation NKLA also noted assets of $925.04 million at the end of the last quarter. Investors should also keep an eye on sector updates as NKLA has historically followed its peers on positive news.

All told, Nikola Corporation NKLA has strung together solid data and demonstrated underlying fundamentals. At its current valuation, NKLA represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

Nikola Corporation NKLA is now commanding a market cap of 7.16B and a float of 115.40M. NKLA is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of NKLA stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in NKLA, either long or short, and we have not been compensated for this article.

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