Please ensure Javascript is enabled for purposes of website accessibility

Why Nikola Stock Is Trucking Higher Today

By John Rosevear – Aug 3, 2020 at 1:03PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Nikola reports earnings tomorrow, and a Wall Street analyst is expecting big news.

What happened

Shares of electric big-rig start-up Nikola (NKLA 11.36%) were moving higher on Monday, after a Wall Street analyst said that the stock could jump after the company's earnings report later this week. 

As of noon EDT, Nikola's shares were up about 9.7% from Friday's closing price.

So what

In a note on Monday morning, Deutsche Bank analyst Emmanuel Rosner added Nikola to the bank's earnings-related short-term buy list while maintaining a longer-term hold rating on the truck company's shares.

Rosner said that while Nikola doesn't yet any revenue to report, it could use its second-quarter earnings call (tomorrow) to provide auto investors with some business updates. If so, those updates could drive shares higher in the near term, the analyst wrote. 

A silver Nikola Badger, a rugged electric pickup truck

Will Nikola announce a manufacturing partner for its Badger electric pickup tomorrow? If so, shares could jump, an analyst said. Image source: Nikola.

While Rosner doesn't know for sure what Nikola will tell investors, he said that updates on new customers for its battery-electric semi, word of a commercial partner for the hydrogen refueling network it plans to build, or the announcement of a manufacturing partner for Nikola's Badger pickup were examples of the kind of news that could give shares a boost.

Now what

Rosner noted that Nikola's share price fell roughly 40% through last Friday from July 20, when the company announced that it expects to issue 23 million new shares over the next few weeks as it redeems warrants given to its early investors. However, Rosner thinks this new supply of shares has largely been absorbed by the market, and the stock price appeared to have stabilized late last week. 

Long story short: Rosner thinks there's a 10% to 20% potential upside in Nikola's shares in the near term following its earnings report. 

Nikola is scheduled to report its second-quarter results after the market closes tomorrow, Aug. 4.

John Rosevear has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Nikola Corporation Stock Quote
Nikola Corporation
NKLA
$3.92 (11.36%) $0.40

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
331%
 
S&P 500 Returns
106%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/05/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.