Workhorse Stock Got Crushed as the USPS Awards Key Contract to Oshkosh
The U.S. Postal Service stated it has actually granted the agreement to change its white, right-hand drive, shipment cars to
a varied seller of military and business cars. The electric-vehicle maker
quote, however it didn’t win.
Now Workhouse shares are plunging.
The award is for 165,000 cars to be provided over coming years. It’s a considerable piece of company.
Workhorse (ticker: WKHS) stock dropped about 47% in Tuesday trading. Stock in Oshkosh (OSK), the winner, ended up 6.1%. The
for contrast, got 0.1%.
The relocations include a couple of hundred million dollars to Oshkosh’s market capitalization and eliminated more than $1 billion in Workhorse’s. The numbers don’t match precisely, however that isn’t a huge surprise. Oshkosh is a bigger business with more sources of earnings. Its market capitalization has to do with $7.5 billion, and it has yearly sales of near $8 billion.
Workhorse didn’t produce considerable sales in 2020. It is attempting to burglarize the growing market for electrical business cars. The USPS news is a problem.
Workhorse was the only all-electric offering amongst the finalists. The stock added after President Joe Biden spoke about making the federal fleet all electrical early in January.
The USPS referred Barron’s to the present news release. It states the Oshkosh cars will have both gas and electrical powertrains, however the number and timing of amazed mail-delivery vans isn’t understood right now. Workhorse didn’t immediately respond to a request for comment.
The next focus for investors will be on what analysts have to say about the news. Before the announcement, about 57% of analysts covering Workhorse stock rated the shares at Buy, in line with the average Buy-rating ratio for stocks in the
Dow Jones Industrial Average.
Roth Capital analyst Craig Irwin downgraded Workhorse stock after the USPS delayed the contract-award decision a couple of times.
Barron’s wrote positively about Workhorse stock back in July, partly because of the USPS opportunity. Shares were about $15 when we made that call. They rose as high as nearly $43, however now are right back where they were.
After talking with Irwin, we recommended selling a little as the stock surged early in the year. That turned out to be a good idea, but Tuesday’s USPS choice still took Barron’s by surprise.
Compose to Al Root at email@example.com
Jobber Wiki author Frank Long contributed to this report.