Lordstown Motors (RIDE) reported increasing losses on Wednesday, as well as progress on an electric pickup truck and new van, after a short seller accused her of deceiving investors. RIDE’s shares fell.
X
Lordstown earnings report
Losses per share increased to 23 cents in the fourth quarter, from 10 cents a year ago with zero revenue, while operating costs and expenses skyrocketed from $ 7.1 million to $ 38.6 million. No reliable estimates for the fourth quarter are available to the pre-revenue company. Throughout 2020, losses per share skyrocketed from 15 cents a year earlier to $ 1.04.
Lordstown said his Endurance pickup will start production in September, with the first beta vehicles ready for testing in late March.
Management also said it is accelerating the development of a second vehicle, a van, and will begin production in the second half of 2022, with the launch of a demonstration vehicle this summer.
Lordstown predicts capital expenditures in 2021 from $ 250 million to $ 275 million. This includes money to build factory capacity to produce 60,000 vehicles a year due to “greater interest in Endurance than originally expected”, new van development, as well as additional tools and higher supply chain costs related to Covid-19 .
Lordstown has estimated a $ 65 billion fleet collection market and says Endurance offers a 25% lower cost of ownership compared to a traditional gas or diesel truck. At investor presentations, Lordstown announced 100,000 pre-orders for the Endurance electric truck, with an average of 580 units per order.
But on March 12, Hindenburg Research accused Lordstown of “largely fictitious” orders. The short seller was previously targeting Nikola (NKLA) and China Kandi (KNDI).
Lordstown CEO Steve Burns told the Wall Street Journal last week that the short sales report contained half truths and lies. The company said it will offer a more complete rebuttal later. Lordstown also said he had made it clear that his orders were not binding.
IBD Live: a new tool for daily stock market analysis
RIDE Stock
The shares fell 0.3% after closing down 0.85% on 9/15 in Thursday’s stock market trading. RIDE’s shares remain below the 50-day line and the 200-day line after the short seller’s report. GM, which has a 5% stake in the company, jumped 5%. AND Workhorse Group (WKHS), which had a 10% stake, amounted to 1.4%.
Lordstown enters a competitive market, with GM, Tesla (TSLA), Ford (F), Amazon (AMZN) – riviano e Canoe (GOEV) will also launch electric pickups in the next one to three years.
But the company said in a presentation in January that it will be “the first to hit the market” with its truck and considers its September delivery target “materially ahead of the (most expensive) offer from its peers”.
According to CEO Burns, “the unique thing about this vehicle – it is electric, but it also has four-wheel drive. The engines are on the wheels.”
RIDE’s shares went public in October, following the completion of its merger with a special purpose acquisition company.
After its founding, Lordstown purchased an old GM plant in Lordstown, Ohio, in November 2019. GM also supplies key parts for Endurance EV, which Lordstown says saves design time and costs to certify.
Find Aparna Narayanan on Twitter at @IBD_Aparna.
YOU MIGHT LIKE:
Are Tesla shares a purchase now? Here’s what earnings, graphs show
Why this IBD tool simplifies the search for the main stocks
Actions to be observed: IPOs better evaluated, large capitalizations and growing stocks
Find the latest stocks that reach buying zones with MarketSmith
Looking for the next big stock market winners? Get started with these 3 steps