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Why Nikola Stock Is Surging Higher Today

Motley Fool - Thu Aug 3, 2023

What happened

Reaching a height that they haven't seen since last November, shares of Nikola(NASDAQ: NKLA) are roaring higher today as investors celebrate the company's achievement in growing its sales orders. But that's not all. A hydrogen peer's announcement today also has investors charged up about Nikola's prospects.

As of 12:12 p.m. ET on Thursday, shares of Nikola are up 12.9%.

So what

Nikola reported yesterday that it currently has 202 sales orders for its electric trucks powered by hydrogen fuel cells. Deliveries of the trucks are expected to begin by the end of 2023. The orders, placed by 18 customers, are mostly for fleet operators and dealers.

Besides Nikola's success in growing sales orders for its fuel cell trucks, news that hydrogen peer Ballard Power Systems(NASDAQ: BLDP) has signed a letter of intent with Ford(NYSE: F) is also driving investors' excitement higher. Ballard will supply Ford with two fuel-cell engines that it will integrate into its Ford F-MAX 44-ton long-haul tractor truck.

Now what

Nikola has built strong momentum in growing orders for its zero-emission trucks recently, and investors are starting to pay much closer attention to the stock after turning their backs on it earlier this year. And with Ballard inking a surprising letter of intent with Ford, a signal that demand for hydrogen-powered trucks might be rising, investors are increasingly interested in hitching a ride with Nikola.

At this point, however, investors should tread carefully with Nikola stock. Booking orders is great, but the rubber hits the road when it delivers on those orders, and it remains to be seen how successful the company will be in that regard. Therefore, only those investors with an ample risk tolerance should give the green light to the stock.

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Scott Levine has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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