stock has dropped below the $10 price used to value the stock when the company agreed to merge with a special-purpose acquisition company merger about a year ago.
Nikola (ticker: NKLA) stock is at $9.68 in midday trading, down another 6% after falling 6.3% Monday.
There isn’t much news to blame for Tuesday’s decline. Stock in all SPAC-related companies are getting hit harder than the market. The
Defiance Next Gen SPAC Derived
ETF (SPAK) is down about 2.6%. The
Dow Jones Industrial Average,
for comparison, are down about 0.8%.
That ETF has more than 200 stocks in it. About 80% are down year to date, and the average drop from 52-week highs is about 33%. The SPAC ETF hit a 52-week intraday high in mid-February. The selloff has been swift and steep.
J.P. Morgan analyst Paul Coster wrote about alternative-energy stocks Tuesday, and his coverage list includes Nikola stock. He recommend investors add to positions after the recent sell off, although Nikola isn’t one of his top picks. He rates shares at Hold and has a $30 price target.
Overall, only two analysts out of eight who cover Nikola stock rate it at Buy. The average Buy-rating ratio for stocks in the Dow is about 60%. Despite the lukewarm opinion of Nikola stock, the average analyst price target is about $25, well above the stock’s current price.
That makes some sense given recent declines, as analysts have trouble keeping up. Nikola stock is down about 37% year to date and down about 94% from a 52-week intraday high of almost $94 set last June.
Write to Al Root at email@example.com