What happened
Fisker (FSRN 12.68%) may be behind other electric vehicle (EV) start-ups with the release of its first commercial vehicle, but it seems there are plenty of customers willing to wait. That news is helping Fisker stock pop today. As of 2:25 p.m. ET, the company's shares had jumped 11.4%.
So what
Investors in Fisker haven't had much to feel good about over the past year as shares have mostly treaded water. Even with several spikes and dips, the stock is trading right about where it started 2021. So far in 2022, shares are down about 8%, even after today's pop.
But its initial vehicle launch is getting closer, and the company said late last week it had over 40,000 initial reservations for its fully electric Ocean SUV.
Image source: Fisker.
Now what
Fisker is offering four models of the Ocean SUV that are being manufactured under a contract agreement by 60-year-old automotive industry supplier Magna International. Production is expected to begin in November. The SUV models range in price from $37,499 to $68,999. Fisker says it believes that "many" of the reservation holders plan to buy one of the top two premium models, both priced at $68,999. If even half of the 40,000 vehicles are bought at that price, that alone will mean revenue of nearly $1.4 billion.
Fisker expects its capacity to be sold out for the two premium models through most of 2023, and it anticipates beginning meaningful production volumes of the other models in 2024. Investors will be watching to see what volume the company estimates it can have produced through 2023. At its recent share price, Fisker is valued with a market cap of $4.3 billion. Once that production guidance comes later this year, it will be more practical to see how the company is valued compared with its EV peers. For today, the customer interest is enough to get some investors wanting to own shares.
