FSR - Here's why the Fisker (FSR) stock price is going vertical
2024-03-15 07:57:23 ET
Fisker (NYSE: FSR) stock price was one of the best performers in the pre-market session. It jumped by more than 37% on Friday, erasing some of the 51% losses it made on Thursday.
The main reason for the surge is that the company refuted claims that it was preparing to go bankrupt . In a written statement, the company confirmed that it had brought in external advisors as it has always done.
It hired these advisors as part of its capital-raising strategy. The statement added that Fisker was engaging with a large automaker in a bid to create a strategic partnership.
Fisker has not named the partner. Nonetheless, there have been rumours that it was talking with Nissan, the giant Japanese automaker, which is interested in its future pickup product.
Nissan has not confirmed or denied this. It is also worth noting that Nissan is in talks with Honda to collaborate on future electric cars. Such a partnership will bring the number two and three Japanese automakers.
Additionally, Fisker said that it was holding talks with a dealer partnership in North American and European markets. The company unveiled a change of strategy to a dealership model earlier this year.
Still, Fisker is between a rock and a hard place . Its vehicle has received some negative reviews and is incinerating cash at an alarming rate. It is also facing substantial logistics challenges moving vehicles from Austria to the United States and Canada. As a result, it has had to lower its delivery targets for this year.
The other challenge is that the company’s balance sheet is on edge. While it ended the last quarter with over $300 million in cash and short-term investments, it is burning hundreds of millions of dollars. As a result, it issued a going concern warning recently.
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