WKHS Stock News: Workhorse Group Inc. plummets after analyst downgrade on USPS contract delays

  • NASDAQ:WKHS has dropped nearly 25% this week.
  • A Wall Street analyst downgrade has investors selling off as skepticism on Workhorse resurfaces.
  • USPS has announced that the much anticipated zero-emissions contract will be delayed until later in the year.

NASDAQ:WKHS has had a good run over the last couple of months, reaching new all-time highs in September as momentum behind the electric truck manufacturer was beginning to build up. On Tuesday the stock took a dive as Workhorse fell by 11.10% and since then it has continued to bleed, closing at $22.30 on Thursday, an accumulated fall close to 25% for the week. Wild fluctuations can be expected from high growth stocks that remain unprofitable, a category in which Workhorse finds itself. Shares are still up over 660% over the last 52-weeks so a pullback here and there is not hurting investors too much right now.

One thing that may be an issue for investors is if the long-awaited USPS delivery vehicle contract is not awarded to Workhorse Group after months of anticipation. Roth analyst Craig Irwin announced a downgrade to Workhorse’s stock after USPS revealed that its decision for the contract may not come until the end of the year. Irwin downgraded Workhorse from a buy rating to a neutral rating and decreased his price target from $33 to $27. While October 13th marked the original date that the contract was to be decided, USPS has delayed its decision potentially another two months. 

WKHS stock news

WKHS stock price chart

The delay of the USPS decision should not be seen as a slight to Workhorse so the drop in its stock and the analyst downgrade seem at this point to be a bit of an overreaction. This could just be some hesitation from investors who are taking off some of their profits from the growth that has taken place already this year. If the stock continues to dip, this could represent a buying opportunity for long-term investors. 

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