Shares of embattled electric big rig maker Nikola Corp. surged after the company started production of revenue-generating trucks and showed it’s making progress on hydrogen infrastructure.
Nikola revealed the milestones in a presentation to Wall Street analysts late Wednesday. On Thursday, the shares rose as much as 19 percent, their biggest intraday gain since Dec. 23, but by midday shares had only risen about 5 percent to $9.59.
The Coolidge, Ariz.-based company sees itself as a leader in clean-energy heavy vehicles in a growing field that includes Tesla Inc. and legacy players like Volvo AB. At the same time, Nikola has been trying to repair its reputation after the indictment of its founder, accusations that it misled investors and a supply-chain crunch that stalled its launch of a battery-electric truck.
Nikola’s updates were met with enthusiasm on Wall Street. JPMorgan analysts said they were left with a “positive impression” after a test ride in both the BEV and future fuel-cell trucks. RBC Capital Markets analyst Joseph Spak said in a note that the automaker is making “rapid progress.” And Deutsche Bank analyst Emmanuel Rosner said he is “highly encouraged” by Nikola’s operational progress and the demand it’s seeing from customers.
CEO Mark Russell said Nikola’s margin outlook is conservative and the company will have the ability to raise prices on battery-electric semis above the current $300,000 sticker prices. Nikola has forecast gross margins this year will be in the range of negative 60 percent to negative 75 percent before turning positive next year. The company expects margins could be as high as 20 percent in 2025.