The logistics company J.B. Hunt Transport Services has announced its order of 13 trucks from electric trucking start-up, Nikola. This exciting development has been well-received by investors.
Nikola revealed on Monday that J.B. Hunt will purchase a total of 13 heavy-duty trucks, with 10 being battery-electric and 3 being hydrogen-fuel-cell-electric. This is a significant win for Nikola, as J.B. Hunt is one of the leading providers of logistic services in North America.
Nick Hobbs, Chief Operating Officer and President of Contract Services at J.B. Hunt, expressed the importance of embracing new technologies and innovative solutions. He stated, “It’s important for us to be at the forefront of new technologies and innovative solutions that have the potential to change the way we move freight.” The acquisition of these zero-emission trucks from Nikola is a step towards achieving their goal of reducing carbon emission intensity through viable solutions.
Following this announcement, Nikola’s stock experienced a rise of 8.4% in early trading on Monday, reaching $2.46 per share. Similarly, S&P 500 and Nasdaq Composite futures saw a slight increase of about 0.2%. J.B. Hunt shares also experienced a positive trend with an increase of approximately 0.9%.
Over the past three months, Nikola’s stock has seen significant growth, rising by approximately 156%. This increase in orders has been a major contributing factor to their success. For instance, an order for 50 trucks from BayoTech resulted in a surge of over 60% in Nikola’s shares in a single day earlier this month.
However, it is worth noting that despite this recent success, Nikola’s stock currently sits at $2.46 per share in premarket trading. This represents a decline of about 97% from its record high of $93.99, which was reached in June 2022. Several factors such as slower-than-expected business development, higher interest rates, and the need for additional capital have contributed to this decline.
According to Wall Street estimates, Nikola is projected to generate approximately $150 million in sales by 2023. In contrast, in 2020, Nikola had projected 2023 sales of around $1.4 billion. Additionally, it is predicted that Nikola will spend over $1.1 billion on expanding its business between now and the end of 2025. As of the first quarter, Nikola had approximately $200 million available in its books.
Written by Al Root