By QuantumScape Corp (NYSE: QS) opened about 14% up on Thursday after hitting a significant milestone.
The advanced battery technology company has successfully developed and set up its next-generation heat treatment equipment – Cobra.
Cobra is crucial for improving the efficiency and cost-effectiveness of producing advanced batteries.
Despite today’s rally, QuantumScape stock is down nearly 15% versus its high in late October.
Why does it matter for QuantumScape stock?
QuantumScape is broadly known for its advanced battery technology that replaces liquids with solid materials to improve the overall performance of electric vehicles.
Hitting the above-mentioned milestone puts the company on track to “deliver higher-volume samples of its first planned commercial product, QSE-5, in 2025,” as per a press release today.
Simply put, the New York listed firm is closer to getting its superior batteries into electric vehicles now that it has successfully developed and installed Cobra.
On Thursday, Tim Holme – the chief executive of QuantumScape dubbed Cobra a “true breakthrough in ceramics manufacturing” that will enable the company to further advance its battery technology.
QuantumScape stock does not pay a dividend at writing.
QS has achieved all of its annual goals
At the start of this year, QuantumScape had laid out the following four objectives for 2024.
- Prepare for Cobra production in 2025
- Begin low-volume QSE-5 prototype production
- Ramp Raptor process
- Ship Alpha-2 samples
The company based out of San Jose, California has now hit all four of those targets. According to Dr Siva Sivaram – the chief executive of QuantumScape:
There’s a lot of work ahead of us, and with our track record of consistent execution, I expect the team to continue building momentum towards gigawatt-hour scale up of our technology.
The Cobra news arrives more than a month after QS reported in-line per-share earnings for its third financial quarter.
Wall Street currently has a consensus “hold” rating on QuantumScape stock.
Are QuantumScape shares worth buying at current levels?
QuantumScape recently announced a licensing agreement with Volkswagen’s battery company PowerCo, aimed at industrializing its next-gen solid-state lithium-metal battery technology.
HSBC analysts acknowledged the deal that brought QS $130 million in prepayment as a pivotal development as they raised their rating on QuantumScape shares to “hold” in November.
The investment firm also hailed the company for its progress in 2024, “going from an early prototype to a near-final product prototype using automated production” in its research note.
Nonetheless, it cited uncertainty related to targeted volumes and royalty rates for its rather modest price target.
HSBC finds QuantumScape stock as fairly valued at $5.30 – a level it has already surpassed on Thursday.
Note that the QuantumScape insiders have been unloading stock in recent months.
Most recently, the company’s director Prinz Fritz sold over $65,000 worth of QS shares.
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