Shares of Workhorse Group rose 8.3% on Monday after it received a purchase order for 6,320 C-Series all-electric delivery vehicles from the privately-held, Pride Group Enterprises.
Workhorse (WKHS), the manufacturer of electrically powered delivery and utility vehicles, said that the order would be divided between its C-1000 and C-650 models. Further, the delivery of the electric vehicles would begin from July 2021 and will continue through 2026. The company also said that its strategic partner Hitachi Capital America (HCA) will help it with inventory financing.
Workhorse CEO Duane Hughes said, “Our new agreement with Pride marks our largest individual order to-date and expands our sales channel internationally into Canada for the first time.” He further said, “Our ongoing partnership with HCA continues to bear fruit as we gear up for scaled production in 2021. This large order solidifies our first-mover advantage and indicates the heightened interest in our last mile delivery products.” (See WKHS stock analysis on TipRanks)
Following the purchase order, Oppenheimer analyst Colin Rusch assigned a Buy rating and a price target of $23 (7.4% upside potential) on the stock. The analyst believes that “orders of this magnitude indicate WKHS’s financial performance is not dependent on a potential US Postal Service contract although we expect the company to win at least a portion of that program.”
He added, “We expect investors to now turn their focus to WKHS’s production ramp which we expect to accelerate by the end of 1Q21.”
Overall, the analyst consensus of a Moderate Buy is based on 3 Buys and 2 Holds. The average analyst price target stands at $24.20, which implies upside potential of about 13% to current levels. Shares have skyrocketed about 598% over the past year.
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