NKLA - Nikola is tipped by BTIG to slow down production pace

BTIG pulled back on expectations on Nikola Corporation ( NASDAQ: NKLA ) after a discouraging read at CES earlier in the month on battery prices and the higher costs of metals.

While Nikola ( NKLA ) brought battery production in-house last year through an acquisition, analyst Gregory Lewis and team expect higher costs and the restructuring of that business to weigh on vehicle production and margins in the near term.

"We note on Friday NKLA announced the closing of the legacy battery facility in California, which will be moved to Coolidge by 3Q23. This restructuring comes on the heels of last week's announcement by Lightning eMotors that ZEV was lowering their sales targets citing non delivery with their battery supplier who is NKLA."

The expectation from BTIG is that NKLA could slow play production over the next few quarters as it continues to work to improve battery manufacturing margins. That outlook led BTIG to lower its FY23 delivery estimate to ~450 BEVs from ~960 BEVs and drop its revenue estimate dramatically. The firm also cut its price target to $5 from $7 in response to the tempered outlook.

Shares of Nikola ( NKLA ) moved up 1.77% in afternoon trading on Tuesday to $2.59 vs. the 52-week trading range of $2.01 to $11.87.

Read more about Nikola's recent manufacturing announcement.

For further details see: