H.C. Wainwright maintains Buy rating on Worksport stock amid operational improvements

Investing.com - H.C. Wainwright has reiterated its Buy rating and $11.50 price target on Worksport Ltd. (NASDAQ:WKSP), highlighting a significant disconnect between the company’s stock performance and its operational improvements in 2025. According to InvestingPro analysis, the stock appears undervalued at its current market cap of $20.72M, though it maintains a weak overall financial health score.

The research firm noted that Worksport shares have declined 66.1% year-to-date, significantly underperforming compared to the Russell 2000 index’s 9.2% increase during the same period. This comes despite the company’s recent September update indicating that the third quarter of 2025 is on pace for record revenue with gross margins exceeding 30.0%. InvestingPro data reveals impressive revenue growth of 232.13% in the last twelve months, though current gross margins stand at 16.54%.

Worksport’s tonneau covers business is expected to generate approximately $20.0 million in revenue in 2025, according to H.C. Wainwright. The company also plans to monetize additional new products in the fourth quarter of 2025 and into 2026, including SOLIS, COR, and heat pump technology.

The research firm believes Worksport could achieve positive adjusted EBITDA on a quarterly basis as early as 2026, establishing a clear path to profitability as core revenue expands and new products enter the market. Despite this positive business momentum, WKSP shares currently trade at less than 1.0 times 2026 Street revenue estimates.

H.C. Wainwright maintains that Worksport’s Made in America products should remain competitively priced and attractive to consumers, driving long-term demand despite potential macroeconomic challenges. Supporting this outlook, InvestingPro data shows the company maintains healthy liquidity with a current ratio of 2.27, indicating strong ability to meet short-term obligations. Get access to 10+ additional ProTips and comprehensive analysis in the Pro Research Report.

In other recent news, Worksport Ltd reported its highest quarterly revenue in company history during its Q2 2025 earnings call, with a notable year-over-year growth of 114% in net sales. The company is aiming for over $20 million in revenue for the full year 2025, supported by innovations in its product line and operational enhancements. Additionally, H.C. Wainwright has reiterated its Buy rating on Worksport, maintaining an $11.50 price target, following discussions with the company’s management at a recent investment conference. The firm highlighted Worksport’s improving gross margins, which increased to 26.0% in the second quarter of 2025 from 17.7% in the first quarter, further advancing to 31.0% in July. Despite facing tariff challenges of 5.0% to 10.0%, the company has effectively managed these issues so far. These developments reflect Worksport’s strategic focus on enhancing its financial performance and operational capabilities.

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