Fisker stock price forecast: don’t buy until this happens

Fisker share price has been in a tight range in the past few days.

The shares remains below the descending trendline.

The stock has also formed a break and retest pattern on the daily chart.

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Fisker (NYSE: FSR) stock price has moved sideways in the past few days as investors focus on the company’s progress. The shares were trading at $6 on Wednesday, ~42% above the lowest level this year. This makes it one of the best-performing American electric vehiclecompanies.

Fisker Automotive published relatively weak financial results. In a statement, the company said that its revenue came in at $198k in Q1, missing analyst forecasts by more than $2.32 million. Its operating expenses rose to over $121.6 million while its net loss jumped to over $120.6 million. The net loss was much better than last year’s $122.1 million.

Fisker Automotive came in $45.7 million while its cash balance came in at over $652.5 million. This means that the company has adequate resources as it moves towards manufacturing. It expects that capital expenditure for the year will be between $535 million and $610 million. 

The company expects that it will continue ramping up its production this year. It will manufacture between 1,400 and 1,700 vehicles in the second quarter. For the year, the company aims to manufacture between 32k and 36k units. Therefore, using the median price of about $50,000, means that the company will bring in about $1.6 billion.

Analysts expect that Fisker Automotive’s revenue will be about $1.75 billion this year followed by over $3.76 billion in 2024. The company is expected to have over $5.17 billion in revenue by 2030. Most importantly, the company is expected to break even in 2024 when it will make $0.03 per share. 

The biggest risk for the Fisker stock price is its business model. Unlike other EV companies, Fisker Automotive’s business model involves using a third-party company to handle the manufacturing. While this is a good model, it has some risks since Fisker does not have control of its most important value chain.

FSR chart by TradingView

The daily chart shows that the FSR share price jumped sharply after starting production. It has remained stuck at the 50-day and 100-day exponential moving averages (EMA). The stock is trading at the important resistance point at $6.40, the lowest point on October 14th. 

Therefore, the outlook of the Fisker share price is neutral until it moves above the two moving averages and the slanting trendline that connects the highest points since August 4 last year. Also, it has formed a break and retest pattern by retesting the lowest point on October 13 and November 10. As such, I recommend buying Fisker shares once they move above $7.50.


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