Choppy Waters for Canoo Stock
Canoo Inc GOEV shares were plummeting in early trading on Tuesday following the company’s disappointing 2024 revenue guidance. This downward spiral came on the heels of an early March announcement of a 1-for-23 reverse stock split.
Analyst Optimism Despite Stormy Seas
While investors reacted with swift punishment, Amit Dayal of H.C. Wainwright & Co. remained steadfastly optimistic. Dayal maintained a Buy rating for Canoo and even raised the price target from $3 to $7.
Steady Course Amid Uncertainty
Despite reporting fourth-quarter revenues of $0.4 million and an adjusted EBITDA loss of $54.0 million, compared to $60.7 million in the prior year’s quarter, Dayal expressed confidence in Canoo’s 2024 revenue projections. Dayal noted that the estimated revenue of $50-100 million implies production of 1,000-2,000 vehicles in 2024, with a target of 4,000-5,000 quarterly productions by mid-2025.
Addressing the Headwinds
The change in the price target reflects several strategic moves by Canoo, including the reverse stock split, significant investments from foreign institutional investors, and progress in fulfilling the Pre-Paid Advance Agreement (PPA), as highlighted by Dayal.
Price Action and Future Prospects
Despite the stock decline of 26.64% to $2.84 at the time of publication on Tuesday, Canoo’s long-term vision to navigate choppy waters toward profitability remains a focal point for both analysts and investors.
Photo: Courtesy Canoo