Weak numbers from a top peer and an analyst’s deep price target cut sent Fisker (FSR -8.49%) stock to the investor used-car lot on Thursday. The high-end electric vehicle (EV) maker’s share price tumbled by nearly 9% on the day, while the S&P 500 index inched into positive territory with a 0.3% gain.
Tepid Tesla
That peer was EV industry pace-setter Tesla, which unveiled its fourth quarter results after market hours on Wednesday. Unfortunately for Tesla shareholders specifically and EV sector bulls generally, the mighty company’s revenue and profitability came in notably under the average analyst estimates. Worse, it cautioned that its volume growth could see significant deceleration this year.
When Tesla sneezes, the rest of the EV sector usually catches cold. Fisker saw a pronounced decline and while other EV makers didn’t fall quite as much, a great many of them also took hits to their share prices.
Fisker’s steeper decline was also due in part to an inconveniently timed price target cut from an analyst at a prominent investment bank. Goldman Sachs‘ Mark Delaney reduced his level by 25% before market open — he now feels Fisker is only worth $0.75 per share instead of his previous $1 level. Delaney maintained his sell recommendation on the shares. Fisker closed the day at just under $0.75.
A high-end maker with a high number of challenges
If conditions are challenging for Tesla these days, you can be sure the road is ultra-bumpy for Fisker. As a luxury manufacturer with only one product so far (the Ocean SUV) the company is vulnerable to begin with, and recent hiccups with deliveries haven’t helped at all.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Goldman Sachs Group and Tesla. The Motley Fool has a disclosure policy.
