What's going on moon gang, i hope you're having an awesome day. My name is matt and in this video i will be talking about workhorse, because its stock is absolutely cooking. Today i will be covering what was in the company's most recent earnings report. I will be doing a technical breakdown of their stock and, at the end i will be sharing my personal opinions on why.

I believe this is an excellent opportunity to invest in workhorse, but before i get into all of that, if you're new to the channel don't forget to join the moon gang by hitting the subscribe button, i'm attempting to hit 5 000 subscribers by the end of this Year and your help with that would be truly appreciated. Also, it would be great if you could drop a like, because it lets me know that you enjoy this type of content, and it also really helps with getting this video in front of other people. Who may be interested and now that i got that out of the way, let's get started alrighty so on november 9th workhorse announced their third quarter results and the stock market reacted very favorably to the report. I would highly recommend checking out this entire article, but in the meantime, i'll quickly go over the key details.

Workhorse set their 2021 production volume target at 1800 vehicles. Two important notes on this number one: it does not include the usps contract because that hasn't been announced. Yet and number two: they do have a current backlog of 1700 vehicles workhorse received a purchase order for 500 c1000 trucks from pritchard. This has me very excited, so i'll cover it in more detail in just a bit.

They have a current cash position over 260 million dollars at their current burn rate. This should get them through a majority of next year. Workhorse has maintained a 10 ownership in lordstown motors. I've discussed this a lot in previous videos, but, to sum it up, i think this will be a huge benefit to both companies as of november 6.

This is valued at 285 million dollars. I've also talked about the partnership with hitachi, which is basically telling me that workhorse is getting everything together to really scale the business. But i haven't spoken about this: workhorse recorded additional new vehicle sales ordered from fluid systems and e-trucks so far, so good. Unfortunately, not everything in this earnings announcement was bullish.

More specifically, the company is having issues related to vehicle production and deliveries. The ceo said this: previously, we projected 300 to 400 vehicles to be produced by the end of 2020, mostly in the fourth quarter. Although we will still manufacture and deliver vehicles in q4, it will be a substantially lower amount than our previous guidance. We are unable to give a specific estimate for the following reasons: number one: the inability of our primary battery supplier to meet our volumes due to capacity issues and covid related slowdowns and number two is covit itself over one third of our production.

Related staff is currently out with the virus or is quarantine awaiting results. Obviously, this situation isn't good. They reported that their deliveries fell all the way to seven, which is very, very low, especially for a company where a lot of its value is based on the number of vehicles delivered depending on how long this virus is in our lives in the short term, workhorse Could still have a rough time ahead on more of a positive note, sales for the third quarter of 2020 were recorded at 565 thousand dollars compared to four thousand dollars in the third quarter of 2019. Obviously, this is amazing growth and it also beat the consensus.

Estimates of 400 000 for the quarter. Once again, i would recommend checking out this article, because there is a lot more information. I just didn't want to read every line to you, because that would be a pretty boring video, but, to sum it up, even though workhorse did miss on deliveries, the company is still growing and i'm specifically excited about the new orders from fluid systems e-trucks and pritchard. Speaking of which workhorse received a purchase order for 500 c-1000 all-electric delivery trucks from pritchard.

This is a pretty big deal, because pritchard is one of the nation's largest commercial vehicle distributors selling over 30 000 units annually to customers across all 50 states earlier on, pritchard had ordered five evs from workhorse, and they liked what they saw. So then they put in this order for 500, but who knows what that could become in the future? Here's what the ceo of pritchard had to say. We see this initial 500 vehicle purchase as being the first of many future orders and look forward to growing with workhorse in 2021 and beyond, if you're, a workhorse investor - and this doesn't get you excited - i don't know what to tell you. This is proof that a workhorse investment could still be viable even without the usps contract.

Now to clarify, i obviously want workhorse to win a large portion of the usps contract and i truly believe that it could. But i don't like the risk of a binary event, and this announcement helps soften that. We all know that workhorse offers a quality product in a rapidly growing sector. So as long as they can keep their delivery numbers up, this investment will have a huge return years down the road to better understand what might happen in the immediate future.

Let's switch over to the charts on the screen. Now is workhorses daily chart, workhorse trades under the ticker wkhs and when the market closed for the day it was up 9.6, which puts its stock just under 19, as you can tell from the volume compared to the average volume over the past 10 days, people were Pretty excited about the earnings report over the past week, workhorse is up almost 18 over the past month. It's actually down 30 percent, but from the start of the year, until now, it's up 520, if you've been keeping up to date with my workhorse videos. You'll be familiar with this technical analysis as a quick recap.

After a period of consolidation, workhorse rallied from 18 to the all-time high just below 31, which was a gain of 73 from there, there was a period of consolidation followed by a bullish breakout that ended up failing so from this high at 28. At one point we were down 45 percent, but now it's only down 32. From october 14th, until november, 2nd workhorse was caught in this bull flag that eventually broke upwards and led to a battle at the support of 16 and 80 cents. But after the earnings announcement, we are now at 19, as things currently stand.

The first resistance isn't that far away it's just below 20 and in fact it's where the stock was rejected today to get back to this level, that would be a gain of almost 4. If the bull camp can push the stock above that, i would then be watching just under 22, and that would be a gain of almost 15 percent and for those of you who are curious to get back to the all-time high of 31, that would be a Gain of 63, anyway, on the flip side, the first support of 1680 would be a decline of 11.4 percent, and then the next support at 1430 would be a decline of 24 and that's actually where i was trying to buy more shares of the company moving forward. There are a few reasons why i believe that this bounce won't be a fake out. The earnings announcement was relatively bullish.

This recent selloff was very large, potentially in overreaction, so i'm expecting a lot of investors to find value at this price level and the rsi is still pretty low when workhorse went from 31 all the way down to 15, the rsi went from overbought to oversold and Now we are bouncing off of that. I'm fully expecting the stock to track back upwards, which would bring the rsi with it because in general, workhorse is still growing and i have a lot of faith in the company winning the usps contract. On more of a personal note, i do own shares of workhorse and my cost basis is in the 18s. So i'm now just barely positive on the position.

My plans for the future is to buy more shares of workhorse in this region of support in between 17 and 14 and then other than that. I'm planning on holding all of my shares for years to come beyond the fact that i truly believe in workhorse. Its stock is prime for a short squeeze and the current risk to reward setup is very favorable, as things continue to develop both fundamentally and technically i'll. Make sure to keep you updated in future videos and also keep you posted on if i ever buy more shares of workhorse so make sure you have your notifications turned on moving forward.

I honestly think that this is an excellent opportunity to invest in workhorse. If you were to fast forward a handful of years, i strongly believe that workhorses stock will be much higher than where it is right. Now, don't get me wrong. This potential for high reward comes with a high amount of risk.

This is definitely a speculative play and should be treated as such. So please proceed with some level of caution with that being said, though, these are my own opinions, so make sure to do your own research, i'd love to know your thoughts on workhorses earnings report and the stock in general. Do you think this is a great time to invest? Let me know in a comment below thanks for making it to the end of the video. Your support truly means a lot to me.

If you enjoyed this video, don't forget to drop a like, and if you haven't already don't forget, to join the moon gang by hitting the subscribe button and as a quick side note, the charting software that i use is called tradingview and there's a link to a Free 30-day trial in the description of this video and there's also a link to the weibo trading platform. If you sign up and make the appropriate deposit you'll be awarded three free stocks, which could be valued anywhere from eight dollars to sixteen hundred. So, in the worst case scenario, you'll be getting twenty four dollars for free thanks for watching and until next time best of luck in the markets. You.