It’s not that the analysts, led by Paul Coster, don’t like the company. They just figure that the stock - at last check trading down 1.8% at $64.71 - is fully valued.
"NKLA is poised to disrupt the transportation industry, with rapid deployment of hydrogen infrastructure and [fuel cell electric] vehicles for use on long-haul trucking routes, reducing carbon dioxide emissions meaningfully and positioning the firm for a key role in the future hydrogen economy," the analysts wrote in a commentary.
"The resulting business model could be compelling.”
But “risks are elevated for this prerevenue company, and the stock looks fully valued here," the analysts said. "[So] we look for a pullback or incremental positive developments to get more constructive."
By prerevenue, the analysts mean the company doesn’t have any yet. It forecasts that sales will begin next year.
J.P. Morgan was the first top Wall Street firm to rate Nikola, CNBC reports.
Meanwhile, a Bloomberg report last week cited knowledgeable sources saying that Trevor Milton, Nikola’s founder, exaggerated the readiness of the Nikola One, its debut truck.
Despite claims in a 2016 public unveiling that a Nikola One prototype was drivable, the model lacked key components and was inoperable, the sources told Bloomberg.
Nikola expects the Nikola One, an electric semi-truck, to begin production next year.
Milton told Bloomberg that parts had been removed from the vehicle for safety reasons but that he "never deceived anyone.”
Nikola shares have soared 90% since the company went public June 4.