Just days ago, in the waning hours of January, electric vehicle stock Canoo (NASDAQ:GOEV) rolled out a notice that left investors a bit shell-shocked to see: it was planning a new release of stock. That didn’t sit well with current investors, who sent shares down over 3.5% in Friday morning’s trading.
Canoo’s move involved a Pre-Paid Advance Agreement with YA II PN, Ltd., otherwise known as “Yorkville.” With the agreement in place, Canoo could request as much as $50 million in cash or greater than that if both parties were willing to do so. With that, Yorkville gets its hands on a set of new warrants, which it will use for “investment purposes” rather than distribution, which it can do because it’s considered an “accredited investor.” Accredited investors get a wide range of privileges that regular investors don’t have access to, like the ability to get in on angel investments or other high-risk early-stage ventures.
A Surging Product Line
The stock offering itself would likely be off-putting to current investors who are about to have their holdings diluted. But Canoo has been actively moving to sell its product line and make the investment pay off for everyone. First, it recently sold 5,450 vehicles to Zeeba to augment its fleet. Then, it made a connection with the U.S. Postal Service in a bid to sell vehicles therein as well.
The Postal Service only purchased six vehicles so far—more of a trial run than anything—but getting an in with the Postal Service might be a huge coup in the making. That adds to a growing list of satisfied customers, including Kingbee, Oklahoma’s Office of Management and Enterprise Services, and even Walmart (NYSE:WMT).
Is GOEV Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on GOEV stock based on three Buys assigned in the past three months, as indicated by the graphic below. After an 86.08% loss in its share price over the past year, the average GOEV price target of $2.08 per share implies 1,095.4% upside potential.
