According to a report published by Reuters, General Motors Co. (NYSE: GM) sold its stake in EV startup Lordstown Motors Corp. (NASDAQ: RIDE) during the fourth quarter of last year. GM owned 7.5 million shares of Lordstown.
Meanwhile, on February 28, Lordstown said its plans to sell 500 units of its electric pickup truck, Endurance, this year, its first full year of production. The company had earlier forecast sales of around 32,000 vehicles in the first year.
Lordstown postponed the launch of Endurance by three months due to supply-chain issues. The truck will compete with the electric trucks of GM and Ford (NYSE: F) that are also expected to be launched in 2022.
Dan Ninivaggi, the CEO of Lordstown, said, “The cost of materials and components at launch will be significantly higher than the vehicle’s anticipated selling price but would improve over time.”
The Ohio-based company expects a five-fold increase in production by next year.
Lordstown did not record any revenue in the fourth quarter of 2021 and reported a loss of $81.2 million.
RIDE stock was trading 2.6% down in the pre-market session on Wednesday, at the time of writing.
Wall Street’s Take
Following the release of the fourth-quarter results on February 28, Deutsche Bank (NYSE: DB) analyst Emmanuel Rosner maintained a Hold rating on the stock and lowered the price target to $3 from $7 (11.5% upside potential).
The analyst believes Lordstown has an elevated risk profile given the fact that the company has not reached a final agreement with Foxconn amid its “pressing need” to raise capital.
Overall, the stock has a Moderate Sell consensus rating based on 2 Holds and 3 Sells. The average RIDE price target of $2.90 implies 7.8% upside potential. Shares have lost 87% over the past year.
TipRanks data shows that financial blogger opinions are 78% Bearish on Lordstown, compared to the sector average of 70%.
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