Huge stories pending this week:
- Uber, Lyft: California could shut them down within ten days;
- Politics: Democratic presidential nominee Joe Biden to pick his running mate by August 10, 2020 (that's today). Later: announcement said to be imminent -- August 10, 2020; perhaps as early as August 11or August 12; DNC convention: August 17 - August 20, 2020
- College football: Power 5 to decide whether the five college conferences will play football this season
- my hunch: yes
- consensus on talk radio: no
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Nikola
Nikola: this was the big story today on the market, based on the price movement and all the stories ... about one story, the deal with Republic for EV trash trucks --- Nikola announces orders for 2,500 garbage trucks -- so I need to put this in context ...
I'm hoping my readers can tell me what a company can expect to "make" on a single truck sale; I'll take a wag --
- NKLA: up 22% today -- after news of the order for garbage trucks; trading for $45; up $8/share
- market cap: $16.982 billion
- to use the City of Chicago project as an example, the average initial cost of a Motiv electric garbage truck is $500,000 (Re-Inventing the Garbage Truck - Squarespace)
Assume the company make $100,000 on each garbage truck
- 2,500 trucks x $100,000 = $250 million
- $250 million / 16,982,000,000 = 1.5%
- if the company delivers all these 2500 garbage trucks, with a profit margin of 20% or $100,000 on a $500,000 truck, that will equal less than 2% of the company's total market cap
Disclaimer: this is not an investment site. Do not make any investment, financial, job, career, travel, or relationship decisions based on what you read here or think you may have read here.
$1 - $2 billion contract; obligated to buy 2,500; option to buy a max of 5,000; "partnered" with Republic;
- 2500 at $1 billion = $400,000
- 5000 at $2 billion = $400,000
Goal: under $500,000/trash truck -- according to Trevor Milton, CEO of Nikola on "Fast Money," August 10, 2020; how this differs from other trash truck companies -- one company, Nikola, will make all three components -- chassis, powertrain, compactor -- instead of "cobbling" together the three components from three different suppliers.
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Nonsense
With all that is going on in the investing world, what is "Fast Money" going to focus on this week? All week, each day, "Fast Money" will have a special segment on cannabis. And with that, television is turned off.
Before I Go
Apparently the transportation sector was up "huge" today.
I mentioned UNP earlier today -- saw ti this morning. How did it finish? Closed up 2%; up almost $4; closed at $186.85.
On another note, SRE: up 2.83% during normal trading hours; up $3.67; closed at $133.57.
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