Nikola Faces 'Another Setback In A Series Of Setbacks,' Says Loop Capital

While the cancellation of Nikola's (NKLA) agreement with Republic Services (Group) is not significant in terms of overall volume for the company's battery-electric vehicle line, it is a negative headline as Republic was to be Nikola's launch vehicle for the battery-electric line in 2022, Loop Capital analyst Jeffrey Kauffman tells investors in a research note.

However, management noted that this customer win was not in the prior guidance and that they expect to announce new customer orders in early 2021, adds the analyst.

"While understandable, this represents another setback in a series of setbacks as of late" for Nikola, says Kauffman in a note titled "Two Steps Forward, One Step Back." He keeps a Buy rating on Nikola with a $35 price target.

The stock closed Wednesday down 11%, or $1.80, to $15.03.


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