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Fisker’s Ocean deliveries will increase in 2023. Morgan Stanley warns investors to avoid the stock.
Courtesy of Fisker
Tesla
Its upcoming price cuts will make it very difficult for other electric vehicle startups—which means investors will have to be more selective when picking stocks in the industry.
Tesla’s (tick: TSLA ) cuts prove electric cars are moving from acute shortage to potential oversupply, according to
Morgan Stanley
analyst Adam Jonas. He sees the industry entering a “dividend phase” and recommends investors have less exposure to EV stocks.
What he doesn’t like and recommends investors avoid is
Fisher
(FSR) and
Clear
shares (LCID). On Wednesday, Jonas downgraded
Fisher
inventory for sale on hold. He lowered his price target to $4 per share from $8. Jonas cut his too
Clear
price target halved – to $5 from $10 per share. He maintained his Sell rating on Lucid shares.
Fisker’s stock is down 6% in premarket trading. Lucid shares are down 2%.
S&P 500
and
Dow Jones Industrial Average
Futures fell 0.7% and 0.5%, respectively.
Jonas still recommends
Rivian Automotive
stock ( RIVN ), although he lowered his price target for the shares to $28 from $55 on Wednesday as well. Rivian shares fell 2.3% in premarket trading.
Tesla is Jonas’ top EV choice. His price target for the stock was cut to $220 from $250 a share on Wednesday. Tesla shares are down 1.3% in premarket trading.
Nasdaq Composite
Futures fell 1.4%.
Overall, 64% of analysts covering Tesla stock rate buy. The average market-to-market ratio for S&P 500 stocks is about 58%. The average analyst price target is about $209 per share, just below Jonas’ mark.
About 60% of analysts covering Rivian stock rate the stock a Buy. The average analyst price target is about $38 per share.
For Fisker and Lucid, about 45% of analysts covering both stocks rate them Buy. The average analyst price target for both stocks is also around $13.
Shares of Fisker and Lucid are down about 36% and 76%, respectively, over the past 12 months. Fisker’s stock has held up better because it’s not as richly valued as other startup stocks. Fisker’s market value is approximately $2.3 billion. Lucid’s is about $14.5 billion even after the steep decline.
Rivian shares have fallen nearly 70% over the past 12 months. Tesla stock is down about 53%.
Rivian’s market capitalization is approximately $16.6 billion. Tesla is the world’s most valuable car company with a market capitalization of around $450 billion.
Write to Al Root at [email protected]
