Cepton downgraded at Craig-Hallum after ‘devastating blow’ of GM cancellations

As previously reported, Craig-Hallum downgraded Cepton (CPTN) to Hold from Buy with a price target of $2.50, down from $20, following the announcement that its General Motors (GM) orders are cancelled as its UltraCruise program is re-scoped. This news is “a devastating blow” for Cepton as it was the dominant driver of sales, the analyst tells investors. While understanding that Cepton remains engaged with GM during this process, and noting that the company continues to believe it has a good chance of winning another series production win with a top 10 OEM, which the firm continues to believe is Ford (F), the analyst is removing all GM contributions from the firm’s model to consider the value of this “poor case (but not worst case) scenario.”