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Key Factors to Note Ahead of Fisker's (FSR) Q1 Earnings

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Fisker Inc. (FSR - Free Report) is slated to release first-quarter 2021 results on May 17, after the closing bell. This will be the second time that the electric vehicle (“EV”) startup would release quarterly numbers as a public company, post its debut on NYSE on Oct 30, 2020. The company went public upon completion of its merger with Spartan Energy Acquisition, an affiliate of Apollo Global Management.

The Zacks Consensus Estimate is pegged at a loss of 19 cents per share for the quarter.

In the last reported quarter, the company reported net loss per share of 5 cents, wider than the loss of 3 cents incurred in the prior year-quarter.

The Zacks Consensus Estimate for Fisker’s first-quarter loss per share has narrowed five cents over the past 60 days.

Earnings Whispers

Our proven model predicts an earnings beat for Fisker this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This has been elaborated below.

Earnings ESP: Fisker has an Earnings ESP of +18.42%. This is because the Most Accurate Estimate of loss of 16 cents per share is pegged three cents below the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Fisker currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors at Play

While California-based Fisker is set to begin production of its first vehicle, the Ocean electric SUV, in the fourth quarter of 2022, it has been drawing immense attention from investors amid the soaring popularity of green vehicles. The firm claims that its Ocean SUV has a range of 250-300 miles on a single recharge. At the end of the first quarter, Fisker had more than 14,000 reservations for the Ocean SUV, which bodes well for the quarter-to-be-reported.

In January, Fisker entered into a deal with automotive supplier Magna (MGA - Free Report) to develop industry-unique advanced driver-assistance systems (ADAS) features and a suite of software packages which will be applied to the Fisker Ocean SUV. In February, the company also signed a memorandum of understanding with Foxconn to develop a breakthrough EV, codenamed Project PEAR, which is expected to have widened Fisker’s potential market share. These agreements raise optimism on Fisker’s future and are likely to have buoyed its first-quarter results.

However, the company has not generated any revenues to date and its Fisker Ocean is more than a year away from production. Thus, given that the company is still in its nascent stage and will take time to capture a niche in the EV landscape, there is a lot of uncertainty surrounding its future. This may have adversely impacted the company’s quarterly performance.

Also, in 2021, the company plans to spend in the range of $210-$240 million each in operating expenses and capex to support its ramp-up plans. This is expected to have further dented the company’s margins for the to-be-reported quarter.

Other Stocks to Consider

Here are a few other stocks in the auto space which are worth considering, as these too have the right combination of elements to come up with an earnings beat this time around:

Canoo Inc. (GOEV - Free Report) has an Earnings ESP of +8.7% and carries a Zacks Rank #3 at present. The company will announce quarterly results on May 17.

AutoZone Inc. (AZO - Free Report) has an Earnings ESP of +3.17% and currently carries a Zacks Rank of 3. The company is slated to release earnings figures on May 25.

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Magna International Inc. (MGA) - free report >>

AutoZone, Inc. (AZO) - free report >>

Fisker Inc. (FSR) - free report >>

Canoo Inc. (GOEV) - free report >>

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