Why This Lordstown Motors Analyst Is Bullish Ahead Of Endurance EV Production

Lordstown Motors Corp RIDE is less than one year away from starting production of its full-size Endurance pickup, and investors should be buyers of the stock today, according to R.F. Lafferty.

The Lordstown Analyst: Jaime Perez initiated coverage of Lordstown Motors with a Buy rating and $35 price target.

The Lordstown Thesis: As of Dec. 22, Lordstown has more than 80,000 non-binding pre-orders for its truck, and production is scheduled to start in the third quarter of 2021, Perez said in a Tuesday initiation note.

The company has a clear path toward a "steady" revenue stream through at least 2022 based on a base price tag of $52,500 before federal tax credits, the analyst said. 

Related Link: Camping World, Lordstown Motors Partner On Sales And Electric RV

The company believes it has enough cash to fund operations moving forward.

The initial public offering bolstered Lordstown's cash on had to $675 million, Perez said, adding that the company needs $135 million for retooling and pre-production expenses, $90 million for R&D and $130 million for operating and G&A.

Over the longer term, the truck is well-positioned to address the growing demand for alternatives to combustible engines amid climate change concerns and companies that focus on ESG initiatives, the analyst said. 

According to the company's estimates, electric vehicles could account for 20% of all U.S. vehicle sales by 2030 and then grow at a 30% to 35% compounded annual growth rate over the next 10 years. By 2040, electric vehicles could account for six out of 10 vehicle sales.

R.F. Lafferty's $35 price target is based on 4x price/sales on 2022 estimated revenue of $1.575 billion.

Click here to check out Benzinga's EV Hub for the latest electric vehicle news.

RIDE Price Action: Shares of Lordstown Motors were trading higher by 3.71% at $20.07 at last check Tuesday. 

The Lordstown Endurance. Courtesy photo.