Fisker Stock: Why This EV Stock Has 180% Upside

Fisker Inc Sells 5,000 Pre-Orders of Limited-Edition EVs

The outlook for Fisker Inc (NYSE:FSR), a beaten-down electric vehicle (EV) stock, just got a little brighter. Fisker recently announced that it sold 5,000 pre-orders for a limited-edition EV model and that the company is on track to start the initial production of that model on November 17.

The 5,000 “Fisker Ocean One” pre-orders represent approximately $350.0 million of potential revenue once all the vehicles are delivered. (Source: “Fisker Inc. Announces Second Quarter 2022 Financial Results,” Fisker Inc, August 3, 2022.)

The company said that, including the Fisker Ocean One pre-orders, its “Fisker Ocean” reservations total more than 56,000. This is an increase from 45,000 in the first quarter of 2022 and 31,000 in the fourth quarter of 2021. With a base price of $37,499, the 56,000 reservations work out to a minimum of $2.1 billion in sales once fully delivered.

Starting on November 18 (the day after the official start of production for the Fisker Ocean One), the company will begin taking pre-orders for its “Fisker Ocean Extreme.” Then, in the first quarter of 2023, Fisker Inc will open up the pre-order list for its “Ultra” and “Sport” models.

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The company also said that its development of the “Fisker PEAR,” a small SUV, has been progressing well. There are more than 4,000 reservations for the Fisker PEAR, and the first deliveries are expected to begin in 2024.

Once the production of the Fisker PEAR ramps up, the company intends to build a minimum of 250,000 per year. The starting price of the Fisker PEAR is $29,900, which points to potential annual sales of $7.5 billion. (Source: “Fisker Pear, a Mass Market EV, Coming in 2024,” Fiskerati, April 14, 2022.)

Fisker Inc expects to unveil its all-electric grand tourer, “Project Ronin,” next summer.

By 2027, the company expects to produce one million EVs annually.

Current Financial Status

As a start-up, Fisker Inc’s revenues aren’t a big concern at the moment. What is important is that the company is on track to hit its production targets and it has the cash to get there. Fisker Inc has both.

The company reported a second-quarter loss of $106.0 million, or $0.36 per share, but ended the quarter with cash and cash equivalents of $851.9 million. (Source: Fisker Inc, August 3, 2022, op. cit.)

That amount of cash and cash equivalents is more than enough to fund the production of the Fisker Ocean One starting in November, as well as the development of additional EV models throughout this year.

FSR Stock’s Recent Price Performance

All these positive developments have been helping Fisker stock turn a corner, climbing by seven percent over the last month.

As of this writing, FSR stock is down by 36% year-to-date and 45% year-over-year, but Wall Street expects shares of Fisker Inc to surpass their previous highs over the coming quarters.

Chart courtesy of StockCharts.com

Of the analysts providing a 12-month share-price target for Fisker stock, their average estimate is $16.83 and their high estimate is $28.00. This points to potential gains from FSR stock in the range of 68% to 180%.

Analyst Take

After periods of uncertainty and delays, it appears that everything is falling into place for Fisker Inc, with the production of its first EV model slated to begin in November.

As mentioned earlier, the pre-orders for Fisker Ocean One vehicles stand at about 5,000 and are worth an estimated $350.0 million. The company expects to launch other Fisker Ocean models over the coming quarters and it expects to launch the Fisker PEAR in 2024.

The demand is high for Fisker Inc’s EVs as the company enters the next phase of its growth plan.

All this means Fisker stock could rise in value.