Nikola’s stock rises as electric-truck producer gets an outperform rating

Nikola’s leadership, which took over in August when former General Motors Co.
GM,
-0.13%
executive Steve Girsky became chief executive, marks a positive development for the company, Kallo said.

“We see significant potential in the market for zero-emissions trucking and believe NKLA has finally found the right management team to capitalize on the opportunity,” Kallo said.

Nikola’s assets include proprietary design and software as “key differentiators” compared to traditional trucks, he said.

“NKLA’s trucks are equipped with proprietary software which we believe is an underappreciated piece of their value proposition,” he said.

Baird’s Kallo said he also sees “potential catalysts” for Nikola’s truck and energy units through manufacturing improvements, customer and partnership announcements, and the build out of hydrogen infrastructure for its hydrogen-powered trucks. The company makes battery-powered trucks as well.

Kallo is keeping an eye on Nikola’s cash burn and liquidity, however.

The company has about $617 million to tap, and it will spend about $540 million in 202.

“[We] believe the company will come back to market in the intermediate term to strengthen its liquidity position and bridge the gap to breakeven,” he said.

Looking ahead, Nikola will likely name a financial chief in the near future as part of Girsky’s team.

Nikola is also expected to announce customers and production refreshes as “key developments to monitor,” Kallo said.

Including Wednesday’s moves, Nikola’s stock is down by 73.7% in the past year, while the Nasdaq
COMP
is up by 37.8% during the same time period.

Also read: Nikola’s stock up on deal for hydrogen-fuel infrastructure