Why QuantumScape (QS) Stock Is Falling Today
Warning! GuruFocus has detected 2 Warning Sign with QS.
The solid-state battery developer reported a $0.20 per-share loss for the quarter, slightly ahead of analyst forecasts of $0.21. It also secured an additional $131 million in future payments through the PowerCo deal, offering new funding support as it eyes commercialization.
The company said its cash runway now stretches into 2029, aided by cost control and improved operating efficiency. Still, shares, up more than 250% since April, face growing skepticism.
At a forward price-to-sales ratio of over 100, QuantumScape's valuation is drawing investor caution. Analysts note much of the company's long-term promise may already be priced in, despite no material revenue yet.
Adding to the pressure, major brokers including UBS downgraded their ratings to sell or reduce, highlighting the risks associated with the company's lofty valuation
Insider selling has also picked up in recent months, which may reflect concerns about overvaluation or slower-than-expected execution.
While QuantumScape's technology remains promising, the current price may leave limited room for upside, and little protection if broader markets turn volatile.
Is QuantumScape Stock Still a Buy?
Based on the one year price targets offered by 7 analysts, the average target price for QuantumScape Corp is $6.04 with a high estimate of $11.00 and a low estimate of $2.50. The average target implies a downside of -52.90% from the current price of $12.83.
This article first appeared on GuruFocus.
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