Back on Apr. 21, I told Hyliion (NYSE:HYLN) investors that HYLN stock was “cheap-as-dirt.” The share price moved up recently, so it’s not necessarily that cheap anymore. However, I still feel that it’s an excellent bargain.
From the outset, Hyliion made its ambitions crystal clear. Basically, this maker of electrified powertrains for Class 8 trucks is prepared to embark on value-added collaborations and disrupt the automotive industry as we know it.
However, the problem for some investors is that they’re itching to see the Hypertruck ERX on the roadways already. And frankly, they’re only going to wait for so long.
In response to this, I recommend being patient and taking note of Hyliion’s recent steps toward commercialization. Give it some time and your investment could yield substantial returns.
A Closer Look at HYLN Stock
Last year, special purpose acquisition companies (SPACs) — particularly ones in the electric vehicle (EV) space — were all the rage. Hence, traders were super excited when shell company Tortoise Acquisition (which traded as SHLL stock at that time) had its reverse merger with Hyliion.
Upon the completion of the merger, HYLN stock debuted on the New York Stock Exchange on Oct. 2, 2020. At that time, the share price was fairly close to $40.
However, the hype phase had already started to wane by that point. Unfortunately, the share price declined in value over the next six months. By the time I issued by bullish call on on Apr. 21, HYLN stock was trading at $8 and change.
Yet, a turnaround appears to be in progress right now. Today, the price has come close to $13 per share.
But for the remainder of 2021, bulls should be realistic. My thoughts? Celebrate the positive updates and look to $18 and $25 as the next price objectives.
As I alluded to earlier, HYLN stock stakeholders aren’t going to wait forever. At the very least, they’ll need regular updates as to the company’s path to commercialization.
Thankfully, though, CEO Thomas Healy threw investors a bone or two when the company released its first-quarter 2021 business updates. Importantly, Healy revealed that Hyliion is “building the first units of Hypertruck ERX demo vehicles right now.” So, there’s that.
Healy also went on to tout Hyliion’s newly formed Hypertruck Innovation Council, “a select group of fleet, logistics and transportation industry leaders that will actively support and advance the development of [the] Hypertruck powertrain solution.” Furthermore, the CEO expressed that Hyliion continues to “make rolling improvements” to its current system.
I’m not 100% clear on what those improvement are, though — or how fast they’re “rolling” out. So, shareholders should stay tuned for further developments on that front.
That said, Healy declared that the HYLN team expects “to begin recognizing revenue on our improved Hybrid product in the second half of this year.”
A High-Value Partnership
So, perhaps it won’t be long now before Hyliion finally starts “recognizing revenue.” This is essential, as Hyliion’s pre-revenue fiscal reports haven’t been particularly inspiring for folks like me who like to see revenue stats.
Instead of revenue data, the news flashes for HYLN stock have come in the form of business updates and, sometimes, partnerships. One noteworthy example is Hyliion’s recently announced arrangement with “Texas-based oil and gas industry leader” Detmar Logistics.
Reportedly, Hyliion will assist Detmar with the electrification of its fleet of “over 100 trucks in the next five years.”
Evidently, Detmar has also already placed an initial order of 10 Hyliion Hybrid Electric units. This marks its first step on the path toward powering its fleet via low-emission solutions.
With potentially lucrative partnerships like this, Hyliion could start to rake in revenue and profits in short order.
The Bottom Line on HYLN Stock
If you’re looking for specific revenue stats to boost your confidence in HYLN stock right now, you’ll probably be disappointed. Currently, Hyliion is still falling short on that front.
On the other hand, though, there are “rolling improvements” on the horizon. So, hopefully in the near future, these will lead to major revenue recognition for Hyliion and its stock. My advice? Sit tight.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.