Despite concerns over the COVID-19 omicron variant, supply chain disruptions, and high inflation, the major market indices had a great run last year. The S&P 500 achieved 70 record highs and returned nearly 27% to investors in 2021. The Dow Jones Industrial Average and the Nasdaq Composite gained 18.7% and 21.4%, respectively, over the same period.
EV stocks have garnered significant investor attention over the past couple of years, with governments worldwide increasing their focus on climate change concerns. New listings in the EV space, Rivian Automotive, Inc. (RIVN), Fisker Inc. (FSR), and Lucid Group, Inc. (LCID), raked in billions of dollars from investors last year. And Tesla, Inc. (TSLA), one of the most prominent EV makers in the world, delivered almost one million EVs worldwide. However, many EV players struggled to stay afloat last year due to a semiconductor chip shortage and rising input prices.
EV stocks Arrival (ARVL), Workhorse Group Inc. (WKHS), Lordstown Motors Corp. (RIDE), GreenPower Motor Company Inc. (GP), and Ayro, Inc. (AYRO) were the worst performers in 2021 last year due to the companies’ poor growth prospects and weak fundamentals. So, let’s look at these stocks.
Based in Luxembourg, ARVL is an automobile manufacturer that is transitioning to electric vehicles by creating zero-emission, desirable, sustainable, and equitable products. The company also offers technology, development, supply chain, automotive, mobility, and fintech solutions.
ARVL faces a class-action lawsuit for alleged violations of 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated by the U.S. Securities and Exchange Commission. According to the complaint, the company made false and misleading statements. It failed to disclose that it would report a substantially higher net loss.
ARVL’s net loss increased 18.1% year-over-year to €26 million ($29.39 million) for the third quarter, ended Sept. 30, 2021. The company’s adjusted EBITDA loss came in at €40 million ($45.21 million), representing an increase of 122.2% year-over-year. Also, its capital expenditure increased 285.7% year-over-year to €81 million ($91.56 million).
Analysts expect ARVL’s EPS for its fiscal 2021 and 2022 to remain negative. The stock declined 73.6% in price last year.
ARVL’s weak fundamentals are reflected in its POWR Ratings. The stock has an overall D rating, which equates to a Sell in our proprietary rating system. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.
It has a D grade for Quality. It is ranked #43 of 67 stocks in the F-rated Auto & Vehicle Manufacturers industry. Click here to see the other ratings of ARVL for Growth, Value, Momentum, Stability, and Sentiment.
Workhorse Group Inc. (WKHS)
WKHS is a Loveland, Ohio-based technology company that is focused on providing solutions to the commercial transportation sector. The company manufactures electric delivery trucks and drone systems. Its products include C-series electric delivery trucks and package delivery aircraft named HorseFly. It also offers a Metron telematics systems platform that allows users to track and monitor the performance of their vehicles.
On Nov. 8, 2021, WKHS announced that it was being investigated by the U.S. Department of Justice and the U.S. Securities and Exchange Commission related to the trading in the company’s securities leading up to a contract award from the U.S. Postal Service.
For its fiscal third quarter, ended Sept. 30, 2021, WKHS’ loss from operations increased 160.2% year-over-year to $25.50 million. The company’s sales, general, and administrative expenses increased 76.6% year-over-year to $10.60 million. And its research and development expenses came in at $2.80 million, up 75% year-over-year.
For its fiscal year 2021, analysts expect WKHS’ EPS to decrease 397.1% year-over-year to $2.08. Its revenue for the quarter ending Dec. 31, 2021, is expected to decline 87.7% year-over-year to $80,000. And it has missed the Street’s EPS estimates in three of the trailing four quarters. The stock declined 78% in price in 2021.
WKHS’ weak prospects are reflected in its POWR Ratings. It has an overall F rating, which equates to a Strong Sell in our rating system. The stock has an F grade for Growth, Stability, Sentiment, and Quality and a D grade for Value. It is ranked last in the Auto & Vehicle Manufacturers industry. To see WKHS’ rating for Momentum, click here.
Lordstown Motors Corp. (RIDE)
Lordstown, Ohio-based RIDE is an original equipment manufacturer of electrically powered pickup trucks and fleet customers. The company’s flagship vehicle is Endurance, an electric full-size pickup truck.
On Nov.11, 2021, RIDE announced that next year’s planned launch of its flagship electric pickup truck named Endurance had been delayed, and that the first deliveries will commence beginning the third quarter of 2022.
RIDE’s operating expenses increased 139.4% year-over-year to $99.28 million. The company’s research and development costs increased 89.8% year-over-year to $56.89 million. Also, its net loss for the nine months ended Sept.30, 2021, increased 428.2% year-over-year to $329.21 million.
Analysts expect RIDE’s EPS to remain negative in its fiscal 2021 and 2022. It failed to surpass consensus EPS estimates in three of the trailing four quarters. The stock declined 82.8% in price last year.
RIDE’s weak fundamentals are reflected in its POWR Ratings. The stock has an overall F rating, which equates to a Strong Sell in our proprietary rating system. RIDE has an F grade for Value and Quality and a D grade for Stability and Sentiment. It is ranked #60 in the Auto & Vehicle Manufacturers industry. To see the other ratings of RIDE (Growth and Momentum), click here.
GreenPower Motor Company Inc. (GP)
Based in Vancouver, Canada, GP designs, manufactures, and distributes electric vehicles for commercial markets. The company offers a suite of high-floor and low-floor electric medium- and heavy-duty vehicles, including transit buses, school buses, shuttles, cargo vans, double-decker buses, and a cab and chassis.
For its fiscal second quarter, ended September 30, 2021, GP’s cost of revenue increased 78.7% year-over-year to $3.48 million. Its total sales, general, and administrative costs increased 129.1% year-over-year to $3.94 million. And the company’s adjusted EBITDA loss increased 22.3% year-over-year to $1.37 million.
For its fiscal 2022 and fiscal 2023, GP’s EPS is expected to remain negative. The stock declined 69.3% in price in 2021.
GP’s POWR Ratings reflect these bleak prospects. The stock has an overall F rating, equating to a Strong Sell in our proprietary rating system. GP has an F grade for Value and Quality and a D grade for Growth and Stability. It is ranked #62 in the Auto & Vehicle Manufacturers industry. Click here to see the ratings of GP for Momentum and Sentiment.
Ayro, Inc. (AYRO)
AYRO in Round Rock, Tex., is an automobile company that designs and manufactures light-duty, emissions-free electric vehicles for urban and community transport, local delivery, closed campus mobility, recreational, and government use. The company products include AYRO 311, Club Car 411, AYRO 511.
AYRO’s adjusted EBITDA loss increased 293% year-over-year to $8.21 million. The company’s net loss increased 347.7% year-over-year to $12 million. And its loss from operations came in at $12.01 million, representing a 403%increase year-over-year.
Analysts expect AYRO’s EPS to remain negative in fiscal 2021 and 2022. The stock declined 76.4% in price last year.
AYRO’s weak fundamentals are reflected in its POWR Ratings. The stock has an overall F rating, which equates to a Strong Sell in our proprietary rating system. It has an F grade for Stability and Quality and a D grade for Growth, Value, and Sentiment. It is ranked #61 in the Auto & Vehicle Manufacturers industry. Click here to see AYRO’s rating for Momentum.
ARVL shares rose $0.18 (+2.60%) in premarket trading Friday. Year-to-date, ARVL has declined -6.74%, versus a -1.48% rise in the benchmark S&P 500 index during the same period.
About the Author: Dipanjan Banchur
Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master’s degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets.These were the 5 Worst Performing Electric Vehicle Stocks of 2021 appeared first on StockNews.com