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Fisker: Hope Is Not A Valid Investing Strategy

Apr. 04, 2021 8:42 AM ETFisker Inc. (FSR)56 Comments


  • FSR shares have been cut in half in recent weeks.
  • But this was to be expected given it has no revenue.
  • FSR is a lottery ticket being valued at $5 billion worth of hope, but I'm cautious given the competitive landscape.

Recharging electric car
Photo by jonathanfilskov-photography/iStock via Getty Images

There are very few sectors that have received as much media and investor attention as electric vehicles. The sector is red hot because as the world’s consumers become ever more environmentally conscious, and as governments

This article was written by

Josh Arnold profile picture
Josh Arnold has been covering financial markets for a decade, utilizing a combination of technical and fundamental analysis to identify potential winners early on in their growth cycles. Josh's focus is mainly on growth stocks. His goal is efficient and profitable use of capital, which overly rigid buy-and-hold strategies do not allow. Josh is the leader of the investing group Learn more.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (56)

These EV spacs have been an amazing investment

On the short side
SufferrinSuccotash profile picture
Too much hype around FSR drawing the attention of short sellers...they will present a better entry point soon enough I think.
@SufferrinSuccotash Please send the links on the Hype
SufferrinSuccotash profile picture
@danforthgs you need look no further than the Fisker forums on this site. If you haven't already, check out the Yahoo forum. The Fiskerettes have all the links you desire. Then you have the blowhard on CNBC tainting the entire industry with his absent minded recommendations.
This analyst is funny. He is totally clueless of how demographics will drive ev sales. Incredible. FSR will rally from here. Author will look bad using antiquated. methods of analysis
SufferrinSuccotash profile picture
@jorgecamargeo hope eternal... I think you are making his point.
lets see where the decline will stop ? any ideas ?
@MICHAELSONG there are getting to be some other interesting spacs in other areas.all in the etfs are getting tossed. Dm is a 3-4 year bet. want to see it in the 10s.
just keep shorting the etf. ive been investing for ? 40 + years and i find that analysts have been constant that whole time... chirp chirp with price targets that are a double but when the stock gets whacked its nothing but crickets... which is why you cant believe targets.......
All ev is penny stock lol 😂
Now the warrants are out of game, the stock rally can begin next week.
@Shehryarand that means what? too easy to short right now. down is still easiset path.
No more warrant to pres more down.
The last warrant will be useless. That means no more dilutions coming years.

You can read from this link:

@Shehryar thank
i hate that there are etfs now for all spacs. sell the etf and instant pressure on the spacs. toooooo easy to short the etf and crap on all contents
Mandingo profile picture
The author could have sumarized/boiled down this whole article to one sentence: I am a trend follower, Fisker is not trending, so I am staying away.
Chris Lau profile picture
@Mandingo That sums up SPAC trading. Every day I look at the 30 SPACs, two are trending, and then they are not.

Why is FSR getting punished alongside $RIDE, $QS?
SufferrinSuccotash profile picture
@Chris Lau mostly because Henrik talks too much when he has nothing to talk about....aka hyperbole. Some things are beginning to appear as though an actual contract or two are materializing so institutions are starting to pay more attention and driving the stock upwards as of late. Still too uncertain for me to risk at this time. I'm researching EV companies with actual sales that won't be decimated in a market correction which I see on the near horizon.
ok. been waiting. just purchased 10k worth. wrote some may calls at 17.5 to knock off 65 cents. i figure $4 downside and 16 up. ill take that.. glta.
Kip Largo profile picture
With no unique tech/battery, it will be difficult for a company most all Americans have never heard of to gain traction. With no reliable public reputation, Fisker's best chance at success is having AMAZING marketing initiatives, period. It needs a large ad and PR budget, easily $100-200 million a year. Otherwise, it's too much work for a consumer to figure out a new company on top of comparing to other EV vehicles. It's just a lot of cognitive barriers for a consumer.

Now you may say, what about Tesla, they didn't spend anything on advertising. True, but they were a first-mover and Elon Musk was the advertising. Fisker doesn't have an Elon Musk and they are entering a crowded field, so they will have to pay heavily to be noticed above the ad budgets of VW, Audi, Ford, GM, Hyundai, and the constant PR of Elon/Tesla etc.

The play to me is the partner builder, Magna.
SufferrinSuccotash profile picture
The arrival of Arrival is going to put a damper on a lot of EV startups. Barklays puts FSR at just above $17 and is backing Arrival.
@Josh Arnold thanks for the article and interest in the stock:) however, I believe you missed to mention the very positive news about the stock...you are right it is a lottery ticket..but a good one..

therefore I would suggest many people to put little money in this quite structured lottery which differentiated itself already with a fully sustainable EV approach, agreement with Magda (this aint a joke) and Foxconn...in addition resting on some cash with a star designer..can it go bust ? yes it may...but imho it deserves to try..
SufferrinSuccotash profile picture
@MICHAELSONG any agreements with any manufacturer, supplier, etc., are not binding and may never materialize, as per their SEC Filing.
@SufferrinSuccotash yep....it can all go bust..this is why it is a lottery....
lshiang profile picture
Besides its partnership with Foxconn, $FSR appear to be at higher risk than Tesla.
here's the ranking of EVs that go to zero first

1) RIDE 2) NKLA 3) FSK 4) RMO 5) GOEV 5) CCIV
Not here to defend or otherwise any EV company, but based on your set of arguments, one could be bearish on almost all EV newcomers. After all, what is anyone's sales projection for a new product or service based on? At the very best, these are all educated guesses based on some comparison but guesses they remain. And then it is the actual performance and quality once on the real roads, whether any issue is minor or structural... too many unknowns.
Even some of the very well known, established EV companies have gone through the same share price pattern recently, so that doesn't mean anything other than the market mood for the whole sector.
Interestingly, the market currently values FSR less than NKLA! Just wondering how many would rather wager on the latter with far more unknowns, to say the least!!!!!
Finally, no matter how deep one goes into any analysis, luck also plays a role unless one is the infallible almighty, or at least some believe they are!
Like this writeup ) seekingalpha.com/...
$FSR 's future is as Bright as hell from what I see, he learned alot from the first go around and was just too early to the game, his plan this time is a total Game changer imo
SufferrinSuccotash profile picture
@TheeSoluution hell is a pretty dark place.
Morgan Stanley 2021 base PT is $40 and bull case PT is $90
Bull case depends on two pillars
1) DA with Foxconn (expected Q2)
2) Battery Supplier (Q2 , Q3 ?)
CabalFollower profile picture
All points previously covered thanks. $FSR as many in EV space are riding the mega wave of cleaner air and President Biden's agenda. The world must operate with a smaller carbon footprint. It is here to stay.
Apple's business model is being copied at Fisker $FSR. I do not believe you address this in your analysis. Fisker $FSR is going to drive competition for Tesla and other EV cars. Investors that want to play this competitive advantage can get a steel on FSR price today (just ask Apollo Global Mgt APO or Louis Moore Bacon).
Morgan Stanley's $40/ price target is just the start (Citi 31 price target). Foxconn and who knows a future partnership with Apple itself will provide a more nimble and competitive approach to Mr. Elon Musk's Tesla. Tesla is building in tremendous fixed costs which will box Tesla in once delivers start.
SufferrinSuccotash profile picture
@CabalFollower Biden was part of the administration that Henrik left with egg on their faces to the tune of nearly a hundred million so don't think Biden will be too generous when Fisker passes the hat.
CabalFollower profile picture
@SufferrinSuccotash We all learn from our mistakes BofA releases a 31 target today. CitiBank has 31 price target and Morgan Stanley releases 40/FSR target From Soup to Nuts: What Investors Need to Know About Autos -- Barrons.com
BY Dow Jones & Company, Inc.
— 12:27 PM ET 04/20/2021
Bank of America published a smorgasbord of auto research Tuesday -- quarterly earnings, electric vehicle start-ups, self-driving lidar technology, and new picks and pans to spice things up. See seekingalpha.com/...
SufferrinSuccotash profile picture
@CabalFollower I'm willing to wager all the SPAC backers were on a conference call this weekend and put together a plan to turn this market around. Doesn't mean the little guy won't benefit from it.
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