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Is Workhorse Group a Buy Under $10?


Is Workhorse Group a Buy Under $10?

Electric vehicle (EV) manufacturer Workhorse Group’s (WKHS) recent pilot program with USDA has garnered significant investor attention. But even though WKHS stock is currently trading at less than $10, given the news regarding the reduction of its equity position in Lordstown Motors (RIDE) and its ballooning losses, is it worth betting on the stock now? Let’s find out.Technology company Workhorse Group Inc. (WKHS) in Loveland, Ohio, is focused on manufacturing battery-electric vehicles and providing mobility solutions to the commercial transportation sector. WKHS’ shares have gained 1.5% in price over the past five days, driven by the company’s recent deal with the U.S. Department of Agriculture to run a pilot program to provide small Unmanned Aerial Systems to support the Department’s efforts in Mississippi. But the stock has plummeted 15.8% over the past month and 50.9% year-to-date, reflecting investor concerns over WKHS’ underwhelming second-quarter earnings report.

Closing yesterday’s session at $9.81, the stock is trading 77.2% below its 52-week price high of $42.96. With the sudden replacement of its CEO Duane Hughes in July, WKHS withdrew its previously announced guidance of an expected production of 1,000 vehicles in 2021. Furthermore, the company’s new CEO, Richard F. Dauch, plans to revise its C-1000 vehicle’s design after delivering only 14 vehicles in the last reported quarter.

Although WKHS has been expanding its product line and improving its operational capabilities, the recent news regarding selling most of its stake in the embattled EV maker Lordstown Motors Corp (RIDE) could make investors anxious about the stock.

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