If you’re a shareholder of Gores Guggenheim (NASDAQ:GGPI), there’s a big reason to vote your GGPI stock on June 22 in favor of the combination with Polestar.
Polestar released the first image of Polestar 3, the company’s electric performance SUV set to debut in October. Eager buyers can step up and place orders at that time. Actual production begins in early 2023.
If you don’t own GGPI, the big reveal sets the table for Polestar 4 and 5. This is an EV company that’s going places. Trading a little below $10 as I write this, and I don’t believe the stock has anywhere to go but up.
Polestar met its 2021 delivery goal of 29,000 EVs. With as many as five models available in the next 24 months, it will be in good shape to meet its future delivery goals — 50,000 in 2022 and 290,000 in 2025 — and send GGPI/PSNY stock into the stratosphere.
Polestar 3 and GGPI Stock
One of the things I’ve always liked about Polestar is that it’s got a significant automotive heritage behind it.
InvestorPlace’s Chris Tyler recently mentioned that Polestar 1 and 2 garnered great reviews from consumers in 19 international markets.
As Chris said, it doesn’t hurt when you’re backed by Volvo (OTCMKTS:VLVLY) and Geely (OTCMKTS:GELYF).
Not only is the Polestar 3 a great-looking vehicle that delivers under the hood, but it’s also further confirmation that Polestar is an EV business that knows how to execute its plans. In four years, it plans to increase its vehicle sales ten-fold. To date, nothing Polestar has done suggests it won’t achieve its lofty goals.
“This is a major milestone for our company, one that boosts our growth trajectory and takes us into our next phase,” CEO Thomas Ingenlath said in a company press release.
Indeed it does.
3 New Vehicles in the Next 3 Years
The Polestar 3 launches in October. Polestar 4 comes in 2023, and Polestar 5 follows in 2024. That will give it five vehicles, including two SUVs. By 2030, it plans to have a climate-neutral car in production.
I’ve been impressed by Nio’s (NYSE:NIO) ability to launch new vehicles quickly. Polestar seems to be in the same category. It isn’t always enough to launch several vehicles; they’ve got to resonate with consumers. So far, Polestar’s products have hit a bulls-eye.
In March, I commented on Ingenlath’s candid comments about what Polestar is and isn’t.
“The CEO came out and said Polestar wasn’t going to be Volvo or some other brand looking for mass appeal. Instead, it would be a niche producer of EVs. In other words, he’s saying if you buy a Polestar, you’ll be getting something unique and special,” I wrote on March 3.
Although it’s only just now bringing out its third vehicle completely separate from Volvo, Polestar’s heritage dates back to 1996. It understands performance.
Why Buy GGPI Stock Before June 22?
As I’ve already said, the vote to approve the combination between Gores Guggenheim and Polestar is on June 22. While it’s always possible that the special purpose acquisition company’s shareholders will vote against the combination, I’d be shocked if they did.
Even though GGPI shareholders will only own 5.8% of the combined entity, they’re getting ownership in a $21 billion enterprise at only 1.5x 2024 revenue estimates. And, yes, SPACs have shown that they’re not very good at providing reasonable forecasts.
Still, Polestar’s track record of producing vehicles at a substantial pace suggests a 2024 revenue estimate of $13 billion is not out of line.
As SPACs go, I would say that Gores Guggenheim/Polestar is one of the best sponsor/target combinations that’s taken place over the past three years. This one’s got winner written all over it.
Make way for Polestar 3, 4, and 5.
On the date of publication, Will Ashworth 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.