Fisker (FSR) is one of those pre-revenue post-SPAC companies that has experience stomach-churning volatility of late.
Like most SPAC peers, Fisker’s $10 reference price for its IPO was bid up to rather impressive highs. In fact, in early March, shares of FSR stock peaked at nearly $32 per share. Not a bad run for a company with no revenues to speak of. (See Fisker stock chart on TipRanks)
Now, Fisker has a few things going for it that contributed to this rally. Not only was the company brought public via a SPAC, and therefore able to ride the SPAC wave higher through the better part of Q1 of this year, Fisker is also an early-stage EV play. Electric vehicle players have been red-hot in recent years. That's for good reason. Everyone wants a piece of the next Tesla, and Fisker’s offering certainly has enticed investors into believing this company has a viable shot at such a trajectory.
But that was way back in March.
Since then, shares of FSR stock dropped below their $10 reference price in mid-May. A range of concerns around a global EV chip shortage, rising inflation, and higher bond yields have snuffed out much of the gains pre-revenue EV stocks (SPACs or otherwise) saw earlier in the year.
However, Fisker rebounded once again to nearly $20 per share in early June. Can this rally continue? Let’s dive into what’s driving FSR stock right now.
Investors in FSR Stock Buying Into the Company’s Mission
As fellow TipRanks analyst Kailas Salunkhe noted in a recent piece, Fisker’s mission is one thing investors are latching on to of late. Specifically, Fisker’s goal of delivering a climate-neutral vehicle by 2027 is something environmentally-conscious ESG-oriented investors can get behind.
The company intends to reach this goal by utilizing climate-neutral materials in its vehicles. While this move is likely to be both difficult and costly, Fisker’s team has embarked on a rather altruistic mission. It appears investors believe in the ability of Fisker’s team to get this done.
Being a pre-revenue company still in the planning stages of commercializing its vehicles, Fisker has the latitude to do this. Unlike other manufacturers with long-standing supply chain agreements and production processes in place, Fisker is essentially operating with a blank slate right now. Accordingly, this announcement appears to not only be great in theory, but plausible as well.
Now, the company’s highly-touted Ocean SUV which is set to be produced in late-2022 won’t make the cut. Nevertheless, the fact that Fisker is thinking about the big hairy audacious goals of the future makes this an aspirational stock investors can get behind right now.
What Analysts Are Saying About FSR Stock
According to TipRanks’ analyst rating consensus, FSR stock comes in as a Moderate Buy. Out of 8 analyst ratings, there are 5 Buy recommendations, 2 Hold recommendations, and 1 Sell recommendation.
As for price targets, the average Fisker analyst price target is $24.29. Analyst price targets range from a low of $10.00 per share to a high of $40.00 per share.
Fisker’s current Ocean SUV model is one that is driving a lot of attention right now. However, investors in Fisker are, by necessity, long-term investors. This company won’t go into production until late next year, and investors are really making a bet on Fisker’s ability to gain market share at this point in time.
Accordingly, this is a stock for investors betting on a brighter future. Inventors seem to think it’s a safe bet that others will like what they see, with Fisker’s recently announced sustainability pledge.
Disclosure: Chris MacDonald held no position in any of the stocks mentioned in this article at the time of publication.
Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.