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Workhorse (WKHS) Warming Up to Q3 Earnings: What to Expect?

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Workhorse Group, Inc. WKHS is slated to release third-quarter 2021 results on Nov 9, before the bell. The Zacks Consensus Estimate for the quarter’s loss and revenues is pegged at 19 cents per share and $1.03 million, respectively. The electric vehicle (EV) maker posted a wider-than-expected loss in the last reported quarter.

The company missed earnings estimates in three of the preceding four quarters and surpassed in the other, the average negative surprise being 208.09%.

Workhorse Group, Inc. Price and EPS Surprise

Workhorse Group, Inc. Price and EPS Surprise
Workhorse Group, Inc. Price and EPS Surprise

Workhorse Group, Inc. price-eps-surprise | Workhorse Group, Inc. Quote

Which Way are the Estimates Headed?

The Zacks Consensus Estimate for Workhorse’s third-quarter loss per share has narrowed by two cents over the past 90 days. The year-ago loss was 78 cents per share. Sales of $57,000 were recorded in the corresponding quarter of 2020, reflecting a surge of 81.23%.

Earnings Whispers

Our proven model predicts does not conclusively predict an earnings beat for Workhorse this time around. The combination of a positive Earnings ESP, and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the odds of an earnings beat. This has been elaborated below.

Earnings ESP: Workhorse has an Earnings ESP of -33.93%. This is because the Most Accurate Estimate of loss per share is pegged 6 cents wider than the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Workhorse, peers of which include ElectraMeccanica Vehicles Corp SOLO, Lion Electric LEV and Nikola NKLA, carries a Zacks Rank of 2 currently. You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors to Note

Deliveries of Workhorse’s flagship C-Series electric van, which is a short-range electric van designed for the so-called last-mile service, are likely to have aided the third-quarter revenues. Workhorse had notified that it produced 133 C-Series vehicles, so far this year till August. Of those, 14 deliveries were made in the second quarter. The company anticipates the remainder vehicles to be sold to the niche markets in the coming 12 months. Also, during the to-be-reported quarter, Workhorse inked an agreement with Amerit Fleet Solutions, per which both companies will jointly provide maintenance service programs for electric and clean fuel technologies to customers nationwide.

However, Workhorse has had a low revenue base over the last few years and is still struggling to capture a niche in the EV landscape. Further, high cost of goods sold due to the elevated tooling costs for the C-Series production is expected to have hurt gross profits during the quarter under discussion. Elevated SG&A and R&D costs also might have clipped the operating margins. Soaring commodity costs and supply-chain distortions amid the global chip shortage are likely to have further dented margins during the quarter under review.

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Workhorse Group, Inc. (WKHS) : Free Stock Analysis Report

ElectraMeccanica Vehicles Corp. (SOLO) : Free Stock Analysis Report

Nikola Corporation (NKLA) : Free Stock Analysis Report

The Lion Electric Company (LEV) : Free Stock Analysis Report

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