Nikola Corp NKLA shares are trading lower by 7.97% to $1.27 Thursday afternoon amid overall market weakness. Shares are declining along with the overall market, which was driven by the release of the September Consumer Price Index (CPI).
The CPI revealed a 3.7% year-on-year increase, exceeding expectations, though the core CPI met predictions.
See Also: Analyst Ratings For Nikola
Why It Matters
Nikola's success depends on consumer and business demand for its electric and hydrogen-powered trucks. If rising inflation reduces consumer purchasing power or affects businesses' willingness to invest in new, potentially more expensive, sustainable transportation solutions, it could hamper Nikola's growth prospects.
See Also: Why ChargePoint Stock Is Getting Hammered
Nikola is also a growth-oriented company that is yet to turn a profit. Inflation can further delay the company's path to profitability as it increases operational expenses and potentially affects pricing strategies.
According to data from Benzinga Pro, Nikola has a 52-week high of $3.97 and a 52-week low of $0.52.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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