Shares of Fisker Inc. continued to… Its losses fell below $1 after the electric car maker lost its most optimistic analyst, who cited the company's continued accumulation of “unexpected growing pains” for his loss of confidence.
“Although we still believe Fisker has the potential to be a player in the electric vehicle market, the inconsistent delivery cadence, shift in distribution strategy, and now the investigation into perimeter braking performance, give us pause to recommend the stock,” TD Cowen analyst Jeffrey Osborne wrote in a note to clients on Wednesday.
Osborne lowered his rating on the stock to market perform, after it has been outperform for at least the past three years. The price target has swung to $1, which is now the lowest among the 13 analysts surveyed by FactSet who cover Fisker, from $11 previously, which was the highest.
Fisker FSR shares,
It fell 7.4% toward a record low in afternoon trading. It closed below $1 for the first time on Tuesday, amid reports that the National Highway Traffic Safety Administration was looking into the Fisker Ocean for safety issues related to its braking performance.
“[W]“We admit we mistimed Fisker reaching its potential and have tried to maintain our confidence in what we still consider a promising product for a very long time,” Osborne wrote.
The California-based company said it has no comment at this time on the reports of the NHTSA investigation.
Osborne said that while regulatory investigations are “relatively common” for automakers and usually have little financial impact, an NHTSA investigation could “further thicken the scar tissue on investor sentiment” by causing “material delays” for a company with deliveries. “sporadic”. – Production rate.
The shift in distribution strategy cited by Osborne signals the company's announcement earlier this month that it is abandoning the direct selling model, in favor of a new dealer partnership business model.
Osborne believes this shift will not only put pressure on margins, but will also require “increased government regulatory approvals.” Combined with the “hybrid” vehicle reviews and NHTSA investigation, he believes the delivery delays the company has experienced will worsen over the next year.
Fisker said in an email to MarketWatch that it is already in advanced talks with unnamed “big name” dealer groups regarding partnerships, and that the National Automobile Dealers Association has “expressed pleasure” with its shift in strategy.
The stock is now down 85.4% over the past three months, while the Global
