Economic and political sanctions on Russia, including bans on Russian oil imports, have pushed the crude oil prices to record highs. The Russia-Ukraine war has precipitated a global energy crunch, and U.S. natural gas prices have jumped 108%, hitting their highest level since 2008. The environmental impact of fossil fuel powered vehicles and soaring crude oil and gas prices have been incentivizing people to switch to electric vehicles (EVs). And the demand for EVs is expected to grow substantially in the coming years.
Furthermore, supportive government funding and policies are contributing significantly to the growth of the EV industry. Based on a forecast by market consultant AutoPacific, U.S. sales of EVs are projected to total 670,000 in 2022, registering an increase of 37% year-over-year. And according to a report by Facts and Factors, the global electric vehicle market is expected to reach $980 billion by 2028, growing at a 24.5% CAGR.
Given this backdrop, Wall Street analysts expect quality EV stocks Workhorse Group Inc. (WKHS), Rivian Automotive, Inc. (RIVN), and Lucid group, Inc. (LCID) to surge in price the coming months.
Click here to checkout our Electric Vehicle Industry Report for 2022
Workhorse Group Inc. (WKHS)
WKHS is a Loveland, Ohio, technology company that designs, manufactures, and sells zero-emission commercial vehicles in the U.S. The company provides electric range-extended delivery trucks. In addition, it provides its Horsefly Unmanned Aerial System, a purpose-built all-electric drone system, and Metron, an air delivery application that tracks the performance of vehicles deployed.
Earlier this month, WKHS agreed with High Trail Capital to exchange its outstanding 4% senior secured convertible notes for $29.70 million of the company's common stock. The transaction should eliminate all debt from the company's balance sheet and should strengthen its financial position.
Last month, WKHS signed a multi-year supply agreement with GreenPower Motor Company Inc. (GP), a leading manufacturer and distributor of zero-emission electric vehicles, to facilitate delivery of medium-duty Class 4 step vans into the North American market. With this partnership, WKHS might redefine its product portfolio, meet significant customer demand, and boost the company's profitability.
For its fiscal year 2021, ended Dec. 31, 2021, the company's cash and cash equivalents rose 330.7% year-over-year to $201.65 million, while its total current assets totaled $216.22 million. WKHS's other income amounted to $225.43 million.
The Street expects the company's EPS for its fiscal year 2022 first quarter, ended March 31, 2022, to grow 88.2% year-over-year. WKHS has an impressive earnings surprise history; it has surpassed the consensus EPS estimates in each of the trailing four quarters.
WKHS stock has plunged 47.5% in price over the past six months. However, the 12-month median price target of $6.75 indicates a 94.5% potential upside from yesterday's closing price of $3.47. The price targets range from a low of $5.00 to a high of $11.00. Among the six Wall Street analysts that rated WKHS, four rated it Buy, while two rated it Hold.
Rivian Automotive, Inc. (RIVN)
Irvine, Calif.-based RIVN designs, develops, manufactures, markets, and sells electric vehicles and accessories in the U.S. The company offers pickup trucks and sports utility vehicles. RIVN also provides an electric delivery van from Rivian Commercial Vehicle, in collaboration with Amazon.com. It sells its products directly to customers in the consumer and commercial markets.
In December, RIVN selected Amazon Web Services, Inc. (AWS), an Amazon.com, Inc. (AMZN) company, as its preferred cloud provider. "By leveraging AWS and building a central data lake to interconnect Rivian's operations, products, and services, we can enable proactive diagnostics and add intelligence to our vehicles, and then use what we learn to generate synergies and scale efficiencies," said Wassym Bensaid, Rivian's Vice President of Software Development.
RIVN's cash and cash equivalents increased 508.7% year-over-year to $18.13 billion for its fiscal year 2021 (ended December 31). Its total current assets increased 515.4% from the prior year to $18.56 billion. The company's net cash provided by financing activities rose 693.1% from the previous year to $19.83 billion.
Analysts expect RIVN's revenue for its fiscal year 2022, ending Dec. 31, 2022, to come in at $1.92 billion, representing a 3,390.6% rise year-over-year. The Street expects the company's EPS for the current year to increase 53.5% year-over-year.
RIVN stock has declined 12.7% in price over the past month and closed yesterday's trading session at $39.15. However, the 12-month median price target of $71.92 indicates an 83.7% potential upside. The price targets range from a low of $35.00 to a high of $112.00. Among the 15 Wall Street analysts that rated RIVN, nine rated it Buy, five rated it Hold, while one rated it Sell.
Lucid Group, Inc. (LCID)
LCID is an American Technology and Automotive company. The Newark, Calif., company designs, develops, manufactures, and sells EVs, EV powertrains, and battery systems using its own equipment and factory. LCID operates more than 20 retail studios in the U.S. It sells its products directly to customers through a retail sales network and direct online sales.
On April 15, LCID announced the opening of its new studio location in the Seaport District in Boston, MA. Following this opening, another location will open at the Gate at Manhasset on Long Island, N.Y. These Studio openings will mark LCID's 26 Studio and service center locations in North America. This is expected to increase the company's physical footprint in the market.
On April 12, LCID commenced the customer deliveries of Lucid Air Grand Touring. The company also introduced a new Lucid Air Grand Touring Performance Model with 1,050 Horsepower and accelerated from 0-60 mph in 2.6 seconds. These developments might extend LCID's customer reach and boost its revenue streams.
In the fiscal year 2021 fourth quarter, ended Dec. 31, 2021, LCID's revenue increased 626.3% year-over-year to $26.39 million. The company's cash and cash equivalents rose 919.3% year-over-year to $6.26 billion for its fiscal year 2021 (ended December 31). Its total current assets increased 882.1% from the prior year to $6.51 billion. Its net cash provided by financing activities grew 453% from the last year to $7.14 billion.
Analysts expect LCID's revenue for its fiscal year 2022 ending Dec. 31, 2022, to come in at $1.30 billion, representing a 4,694% rise year-over-year. The Street expects the company's EPS for the current year to rise 77.2% year-over-year.
Shares of LCID have increased 9.6% in price over the past year and closed yesterday's trading session at $21.41.
Among the four Wall Street analysts that rated LCID, three rated it Buy, while one rated it Sell. The 12-month median price target of $40.50 indicates an 89.2% potential upside. The price targets range from a low of $12.00 to a high of $60.00.
Click here to checkout our Electric Vehicle Industry Report for 2022
WKHS shares were trading at $3.30 per share on Wednesday afternoon, down $0.17 (-4.90%). Year-to-date, WKHS has declined -24.31%, versus a -5.73% rise in the benchmark S&P 500 index during the same period.
About the Author: Mangeet Kaur Bouns
Mangeet’s keen interest in the stock market led her to become an investment researcher and financial journalist. Using her fundamental approach to analyzing stocks, Mangeet’s looks to help retail investors understand the underlying factors before making investment decisions.
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