IB Net Payout Yields Model

Nikola: Making Progress, But Lacks Capital


  • Nikola has started making real progress towards becoming a legitimate BEV manufacturer.
  • The company forecast delivering up to 100 units by year end after starting trial production this month.
  • The company needs more capital and normal production delays are likely to disappoint shareholders.
  • Investors should wait for a dip to buy the stock as a 9x EV/S target for 2025 is still expensive for the risk.
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As someone ultra bearish on Nikola (NKLA) after the company went public via a SPAC to an irrational valuation, my view is now more neutral on the stock. The BEV company has made substantial progress towards becoming a legitimate manufacturer of trucks. Ultimately though, my investment thesis is neutral on the stock as the current price is still over 9x 2025 sales targets.

Read the full article on Seeking Alpha. 

Disclosure: No position mentioned. Please read the disclaimer page for more details. 

Update - July 29

No surprise the former CEO is being charged with fraud. The surprise is that the stock is down 11% on this news possibly providing a part of the bottoming process. The current Nikola is nothing like the old Nikola under Trevor Milton. 

Finviz Chart

  • Nikola (NASDAQ:NKLA) falls after company founder Trevor Milton is charged by the U.S. Attorney's Office in Manhattan with three counts of making false and misleading statements to investors.
  • The charging document alleges Milton mislead investors on "nearly all aspects" of the business.

Update - June 14

Interesting deal to raise some capital here. Nikola needs far more than $300 million so this deal is only a start keeping us on the sidelines for more capital raises. 

-Shares of Nikola are down in premarket trading Monday after the company strikes a deal to sell up to $300 million worth of stock to Tumim Stone Capital.

The stock continues making a base with a retest of $15 or below likely. 

Finviz Chart

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