Polestar Automotive Q2 report ‘bittersweet,’ says Cantor Fitzgerald

Cantor Fitzgerald reiterates an Overweight rating on Polestar Automotive with a $6 price target following the Q2 report. The reduction in gross margins was driven by higher contract manufacturing costs, supplier charges for semiconductors and batteries, and inventory impairment, which were partly offset by a positive currency effect, the analyst tells investors in a research note. The firm views the earnings report as “bittersweet.” While vehicle deliveries were above expectations, the company reported a revenue miss, and recorded a negative gross margin, which was surprising and worse than expectations, says Cantor. However, the firm continues to believe Polestar benefits from the “rapidly growing” industry demand for electric vehicles, the support of Volvo and Geely, and a “meaningful” partnership with Hertz.