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PSNY Stock Alert: Polestar Just Cut Its 2023 EV Forecast

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  • Sweden-based automaker Polestar (PSNY) reduced its 2023 delivery guidance for the second time this year, leading to a decline of nearly 9% by PSNY stock yesterday.
  • Polestar aims to produce 155,000 to 165,000 EVs annually by 2025.
  • PSNY stock has tumbled 61% so far this year.
PSNY stock - PSNY Stock Alert: Polestar Just Cut Its 2023 EV Forecast

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Polestar (NASDAQ:PSNY) stock fell sharply yesterday after the electric vehicle (EV) maker lowered its 2023 delivery guidance to roughly 60,000 vehicles, down from the 60,000-70,000 range that it had previously forecast. The automaker issued the revised guidance in conjunction with its third-quarter results, which were released on Wednesday after the market closed.

Further, PSNY shared that it would need to obtain additional funds in order to stay afloat.

PSNY stock is doing a bit better this morning, as it is up around 3% in early trading. However, it is still down nearly 15% for the week.

The Evolution of Polestar’s Production Guidance and Other Data Provided by PSNY

Last May, Polestar lowered its 2023 delivery guidance to 60,000-70,000 EVs. The firm’s previous outlook, set in March, had anticipated 80,000 deliveries in 2023. In June 2022, before PSNY stock became publicly traded, the company predicted that it would deliver 290,000 EVs by 2025.

On Wednesday, the automaker stated that it would seek to produce 155,000 to 165,000 EVs annually by 2025. PSNY also wants its gross margin to reach nearly 20% by 2025, up from the roughly 2% that it expects this year. Moreover, the company will seek to stop burning cash by 2025.

Additional Funding

Polestar said it would require $1.3 billion of additional funds. That amount will enable it to keep the lights on until it stops burning cash in 2025, the automaker explained.

Polestar was founded by two Chinese-owned automakers, Geely (OTCMKTS:GELYF) and Volvo (OTCMKTS:VLVLY), and PSNY has obtained a combined $450 million in loans from those automakers. Their loans can be converted to PSNY stock.

Polestar may obtain part or all of the additional funds it needs from Geely and Volvo, which are also providing it with “facilities and… production support.”

As of this writing, Larry Ramer did not hold (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.

Larry Ramer has conducted research and written articles on U.S. stocks for 15 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been SMCI, INTC, and MGM. You can reach him on Stocktwits at @larryramer.


Article printed from InvestorPlace Media, https://investorplace.com/2023/11/psny-stock-alert-polestar-just-cut-its-2023-ev-forecast/.

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