Beware These 4 Overvalued Electric Vehicle Companies

A consensus EPS estimate of $0.76 for the current quarter ending Mar. 31, 2021 represents a 230.4% rise year-over-year. TSLA has an impressive earnings surprise history, as well; it beat the Street EPS estimates in three of the trailing four quarters. The consensus revenue estimate of $9.95 billion for the current quarter represents a 66.2% improvement from the same period last year.

TSLA has an overall rating of C, which equates to Neutral in our POWR Ratings system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree. It has an F grade for value and D grade for Stability and Sentiment. In the 52-stock Auto & Vehicle Manufacturers industry, TSLA is ranked #35.

TSLA shares fell $0.88 (-0.11%) in after-hours trading on Friday. Year-to-date, TSLA has gained 15.65%, versus a 5.02% rise in the benchmark S&P 500 index during the same period. You can check out TSLA’s additional ratings for Growth and Quality here.

Fisker, Inc. (FSR)

Founded by renowned luxury car designer Henrik Fisker, FSR made its public debut through a reverse merger in October. The company went public through an SPAC with Apollo Global Management (APO), affiliated with Spartan Acquisition Energy Corporation, on Oct. 30, making it one of the newest players in the electric vehicle market. FSR has generated $1 billion in cash through the merger, including $500 million through common stock PIPE funding.

FSR is expected to launch its Fisker Ocean vehicle in the fourth quarter of 2022, and three vehicles by 2025. The company recently partnered with auto supplier Magna International (MGA) to supply the vehicle platform and build its Ocean SUV. It plans to launch its debut EV Ocean with autonomous driving features, integrated through the Fisker Intelligent Pilot.

Last October, FSR announced a strategic partnership with Viggo Sign for the delivery of 300 vehicles in the fourth quarter of 2020. Last July, FSR entered advanced talks with Extreme E for a potential strategic partnership.

FSR has gained 60.3% since its market debut late October. However, the company doesn’t have adequate financials to back up this stock price gain. It is still in the production phase and has yet to launch a vehicle in the market. FSR has a market capitalization value of $4.28 billion.

With the company’s plan to debut Fisker Ocean EV in the fourth quarter of next year, it is unlikely that FSR will generate revenues in fiscal 2021. The stock is therefore surging on investor optimism alone, and is a highly speculative investment bet. Analysts expect FSR’s EPS to decline 37.9% this year.

FSR has an overall rating of F, equating to Strong Sell in our POWR Ratings system. It has an F grade for Value, Quality, and Sentiment, and D for Growth and Stability. It is ranked #52 in the same industry. In addition to the grades I’ve highlighted, you can check out additional ratings for Momentum here.

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