Workhorse Group Is Ready To Get Back On The HorseWorkhorse Group had a rough 2Q but the company is ready to get back on the horse after hiring a new CEO and regrouping for success.

Workhorse Group (NASDAQ: WKHS)and the rest of the EV market got a lift in mid-summer whenTesla (NASDAQ: TSLA)released better-than-expected earnings and apotential stock splitthat could be worth billions to investors. The caveat is that Workhorse Group, like other EV startups such asLordstown Motors (NASDAQ: RIDE)andNikola (NASDAQ: NKLA), is still in the very early phases of its production cycle and may not be able to catch up with the bigger players. The dominating story in Workhorse's world is the recall of C-1000 vans last year and the subsequent end of the C-series lineup, a lineup that is being retooled but may not reenter production. Regardless, the previous lineup is already being enhanced by the class-4 W750 step van built on a chassis supplied byGreenPower Motor (NASDAQ: GP).

Workhorse Group Has Rough Quarter, Maintains Guidance

Workhorse Group hada rough quarterproducing only $0.01 million in revenue. This is down from last year's $1.2 million due in totality to the ending of the C-series lineup. The expected revenue comes with a wider than expected loss attributed to the company's retooling efforts. The good news is that Workhorse could maintain the full-year guidance for sales of up to 250 vehicles due to thedeal with Greenpower Motors. Greenpower Motors delivered the first of its EV Star Cab and Chassis combinations about a week before the Q2 results were released and has the company on track to meet its projection for the first deliveries. The first deliveries are expected to go out by late Q3 or early Q4, with production ramping over the next year.

"We have been collaborating with Workhorse for nearly a year on the co-development of zero-emission commercial vehicles with the integration of our EV Star CC for Workhorse's W750," said Brendan Riley, President of GreenPower. "Today's announcement is a strategic milestone for both companies against our shared commitment to building safe, reliable commercial EVs. Our third quarter deliveries are well underway, with the first eight EV Star CCs delivered to Workhorse in July and another shipment of eight being delivered in early August. We look forward to rapidly scaling up deliveries over the next few quarters to support Workhorse's production requirements to meet customer demand."

Analysts And Short-Sellers Weigh On Workhorse Group Price

The analysts and short-sellers have been adding downward pressure to the Workhorse Group price action, and it may not let up in the near term. There has been, but a single analyst commentary since the report was released, and it includes adowngrade to Neutralfrom Buy and a price target reduction to $3.50. The takeaway, however, is that sentiment has been firming over the last few months and has the Marketbeat.com consensus rating up to a Moderate Buy from the Hold it was pegged at last year. The $3.50 target set by Roth Capital is not the lowest on Wall Street, but it's not far off, and it does assume fair value at current price levels.

As for the short-sellers, theshort interest on this stockwas pushing 30% at the start of the month, and it is unlikely to have fallen significantly on the Q2 results. Looking forward, however, there is a growing opportunity in the stock assuming it can remain on track to hit the new production goals. In that scenario, we may start seeing some short-covering begin and it could easily turn into a short-squeeze. Looking at the chart, Workhorse Group appears to have established a bottom at the $3.00 level.