Lordstown Motors May Gain 67%. But is it a Strong-buy?
The stock market experienced many ups and downs during the last few months. The Covid-19 pandemic still hinders global economy greatly, and not all companies will manage to survive it. It’s especially important to choose wisely where to invest your money. However, the current crisis also provides opportunities. You can buy some stocks much cheaply as the market is often bearish.
Lordstown Motors is one of the promising companies. This Ohio-based electric vehicle maker firm is closely linked to Big 3 standard General Motors. It owns more than 6.2 million square feet of production floor space. The company also has a capacity to produce 600,000 vehicles per year.
Lordstown Motors’ flagship vehicle is the all-wheel-drive Endurance pickup truck. Based on a unique design, the vehicle uses individual electric motors at each wheel hub. The company will deliver the Endurance in the fall of 2021.
Lordstown Motors was founded in 2018, and it went public earlier this year. The company has entered into an agreement with Camping World Holdings (CWH), the RV maker, as it prepares for releasing its Endurance truck. It will provide garage floor space for Lordstown’s customers. Furthermore, the agreement includes potentials for expansion, such as sharing space, sales, or even providing electric drive systems for RVs.
What do the analysts think about the stock?
Goldman Sachs’s analyst Mark Delaney believes that this collaboration is a first step and the company will continue to refine its service footprint and infrastructure. He also noted that Lordstown’s decision to leverage an existing service footprint is a cost-effective strategy.
According to Delaney, the broader customer experience plays a significant role in product differentiation. It can help EV start-ups to become successful. The ease and reliability of maintenance and charging are especially crucial to Lordstown’s customer base, as it focuses on vehicle up-time.
The analyst gave the stock a Buy rating, sating his price target at a $31. In case of success, the company will gain 67% over the year.
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