Nikola is overvalued because it chose the wrong technology for road vehicles. The fair market value is cash plus some multiple for engineers.

Disclosure: the author is short Nikola, meaning he financially benefits if the share price falls. Please consider this bias while reading.

Falsifiers: (1) Nikola abandons hydrogen and develops worldclass long-haul BEVs; (2) building hydrogen infrastructure and hydrogen vehicles is cheaper than estimated; (3) battery innovation lags and BEVs struggle to match range and rechargability hydrogen vehicles.

Bull Case

The bull scenario for Nikola is simple and alluring: hydrogen-powered trucks and road vehicles will provide a lucrative on-ramp…

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