Author argues Xos is undervalued because it generates positive LTM free cash flow of $6.2M against a $23M market cap, despite GAAP net losses driven by non-cash items, and expects a re-rating once LTM profitability flips positive.
XOS — LONG Author claims Xos has a $23M market cap and $6.2M LTM free cash flow, a P/FCF of ~3.7, while net losses are due to non-cash items; he expects the market to re-rate the stock once LTM profitability flips positive and the P/FCF becomes a positive P/E. Stated risks are low trading volume/liquidity and the possibility that Q4 will not show positive FCF because last-mile delivery companies buy fewer trucks during the holiday delivery season.
I just can't see the price staying this low when the P/FCF of 4 eventually becomes a P/E of 4.