Things were better today for electric vehicle stock Fisker (NYSE:FSR). Yesterday was a calamity that might have spelled the end of the entire operation. However, Fisker is now enjoying a 9%+ surge in share prices as word emerged about a new strategic partner that will take a lot of the bankruptcy worries off the table. At least for now.
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While it’s not yet known just who the strategic partner is that Fisker is talking to, the firm recently clarified that the “outside advisors” it was talking to aren’t related to a potential bankruptcy filing at all. Rather, those advisors were brought in to help address key issues within the business, and help develop strategies to improve it.
There is no shortage of issues to address within Fisker; over the last few months, it’s had several mechanical problems with the Ocean SUV and has been struggling to maintain operations in the face of declining capital. Fisker further encouraged its employees to “disregard the media noise” and “stay focused on serving customers.”
A Going Concern Problem
Only a month or so ago, Fisker offered a “going concern” warning, suggesting that it could run out of cash as early as sometime this year. It’s also had some trouble with the fact that it’s selling a vehicle priced in about the same class as a Porsche in some places.
A gas-powered 2019 Porsche Macan with 36,000 miles on it in Orlando, Florida, runs $31,998. That’s actually about $7,000 cheaper than a 2024 Fisker Ocean entry-level model. In a time when many potential buyers are reconsidering fast food in light of price hikes, Fisker’s ability to sell an electric vehicle priced like a used sports car will likely suffer.
Is Fisker a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on FSR stock based on five Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 97.08% loss in its share price over the past year, the average FSR price target of $1.11 per share implies 555.25% upside potential.
