ZEV - Lightning eMotors still faces headwinds this year - BofA

2023-05-18 08:10:11 ET

Bank of America warned on Thursday that Lightning eMotors ( NYSE: ZEV ) still faces a tough road ahead after Q1 results and production were impacted by the recall of Romeo battery powered units. Revenue for the quarter trickled in at $1.3M vs. $5.8M consensus.

The Colorado-based company reported that it received an order for 126 units from Macnab on May 12, which should help it draw down inventory and help improve cash burn. However, analyst Sherif El-Sabbahy warned that many of the headwinds for ZEV have yet to clear.

BofA reiterated an Underperform rating on Lightning eMotors ( ZEV ) and price objective of $3.50 with the full-year outlook heavily weighted to the back half and a risk of dilution still in the mix.

"While Lightning e-Motors product has passed testing and validation by customers, the firm faces significant hurdles near term as it ramps production and faces supplier shortages. Medium term the firm is likely to see intense competition in higher volume markets, with competition in niche markets likely to enter longer term."

Shares of Lightning eMotors ( ZEV ) moved up 2.43% premarket on Thursday to $3.80 to cut into the 13% post-earnings drop. The EV stock is down more than 50% on a year-to-date basis.

More on Lightning eMotors:

• Lightning eMotors earnings call transcript
• Growth metrics on Lightning eMotors
• Relative strength index and moving averages
• Seeking Alpha's Quant Rating for Lightning eMotors

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