Bullish indicating open at $55-$60, IPO prices at $37
GreenPower Motor Company Inc (NASDAQ: GP) has experienced a revision in its stock outlook as Roth/MKM maintained a Buy rating but reduced the price target to $1.65 from the previous $3.00.
The adjustment comes in response to the company's reported revenue for the first quarter of fiscal year 2025, which fell short of expectations.
The analyst from Roth/MKM noted that despite the lower-than-anticipated revenue for the first quarter that ended in June, there is a belief that existing orders slated for near-term delivery could help build momentum for the company. However, due to a more conservative outlook, the firm has revised its estimates downward.
The management of GreenPower Motor has been commended for its effective control over expenses. Moreover, the analyst anticipates that the liquidation of the company's finished goods inventory is likely to generate positive cash flows in the near term. This financial maneuver is expected to contribute to the company's liquidity position.
The progress of GreenPower Motor's manufacturing facility in West Virginia is set to be a point of focus, as the delivery of Electric Vehicle Star Buses (EVSB) from this location is projected to bolster the company's financial performance later in the fiscal year.
In other recent news, GreenPower Motor Company reported a revenue of $39.3 million and a gross profit of $5.4 million for the fiscal year ending March 2024. The company's sales have seen an uptick, particularly in the school bus market with orders for over 100 buses and an additional 160 in the pipeline.
Analysts at Roth/MKM maintain a positive outlook for GreenPower, citing the company's low breakeven threshold and strong backlog as key factors. The firm's stance is based on GreenPower's ability to remain profitable with only 50-60 unit deliveries per quarter. The company's order book, which could generate over $100 million in revenue, is viewed as a significant driver of GreenPower's financial performance.
InvestingPro Insights
Following the recent outlook revision by Roth/MKM for GreenPower Motor Company Inc (NASDAQ:GP), it's essential to consider key financial metrics and analyst insights provided by InvestingPro. The company operates with a notable debt burden and analysts have expressed concerns about its ability to make interest payments (InvestingPro Tip #1). Additionally, while there is optimism for sales growth in the current year (InvestingPro Tip #2), the latest data shows a substantial decline in revenue over the last twelve months as of Q1 2025, with a decrease of 53.79% (InvestingPro Data). Analysts also point out that GreenPower Motor is not expected to be profitable this year (InvestingPro Tip #5).
Despite a significant return over the last week (InvestingPro Data), the stock has experienced a considerable downturn over the past month, three months, and six months, with price total returns of -29.24%, -35.96%, and -61.18% respectively (InvestingPro Data). This is in line with the analyst's cautious stance, reflected in the reduced price target. Furthermore, the company's gross profit margin stands at 11.3%, highlighting challenges in maintaining profitability (InvestingPro Data).
For investors seeking a more in-depth analysis, there are additional InvestingPro Tips available on the platform, which provide a comprehensive view of GreenPower Motor's financial health and market position. With these insights, stakeholders can make more informed decisions about their investment strategies.
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