Written by Cláudio Afonso | LinkedIn | X
Following the release of Canoo’s second-quarter earnings results late Wednesday, Alliance Global Partners has adjusted its price target on the stock, lowering it from $18.50 to $14.
Taking into account the reverse stock split executed by Canoo in March, the adjusted price target now stands at $0.61 per share. This new target suggests a significant downside potential of approximately 56% from Wednesday’s closing price of $1.41.
In a newly issued research note, Alliance Global Partners noted that, similar to other companies in the EV sector, Canoo has faced significant pressure due to its limited revenue generation, persistently negative cash flow, and challenges in securing capital funding.
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The firm also pointed to Canoo’s guidance for the second half of 2024 and anticipated future capital raises as additional factors behind the revised outlook.
In March, Alliance Global Partners had previously reduced its price target for Canoo shares from $20 to $18.50 (pre-split), while reaffirming its Buy rating. The firm initially began coverage of Canoo in August 2023 with a Buy rating.
Canoo reported on Wednesday that it expects an Adjusted EBITDA loss ranging between $120 million and $140 million for the second half of 2024. The company indicated that it is “in advanced stages of discussions with other sources of capital” to address its financial needs.
Canoo reported on Wednesday its second-quarter earnings posting a record revenue of $605,000. The company did not disclose the number of vehicles delivered between April and June.
However, the chief executive Tony Aquila, said in a statement the results represent “good progress” with customers adding that they “drove more than 34,000 recent real world, industrial use miles”.
The stock reached a record low at $1.22 per share in March reflecting concerns over the lack of progress in the pilot programs announced over the last two years.
Written by Cláudio Afonso | LinkedIn | X
