The Lion Electric Company (LEV.TO) | Investment Case

1. Company Snapshot

1.a. Company Description

The Lion Electric Company designs, develops, manufactures, and distributes purpose-built all-electric medium and heavy-duty urban vehicles in North America.Its products include battery systems, chassis, bus bodies, and truck cabins.The company also distributes truck and bus parts, as well as accessories.

The Lion Electric Company was incorporated in 2008 and is based in Saint-Jérôme, Canada.

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1.b. Last Insights on LEV

The recent performance of The Lion Electric Company has been negatively driven by several factors. The company's Q3 2024 earnings missed expectations, with revenue declining 62% year-over-year to $30.6 million. Analysts have also trimmed their revenue forecasts by 11%, indicating a decline in investor confidence. Furthermore, the company has defaulted under certain of its senior debt instruments, and its covenant relief period has expired. Additionally, the NYSE has commenced delisting proceedings for the company's warrants, and the company has announced further workforce reductions and filed for creditor protection under the CCAA. These developments suggest a challenging business environment for the company.

1.c. Company Highlights

Last Price	0.34
Change Percentage	0.00%
Open	0.35
Previous Close	0.34
Market Cap ( Millions)	78
Volume	2863397
Year High	2.5
Year Low	0.25
M A 50	0.37
M A 200	0.89

FCF Yield	-12.02%
Dividend Yield	0.00%
ROE	-17.99%
Debt / Equity	139.81%
Net Debt / EBIDTA	-3728.26%
Price To Book	0.2
Price Earnings Ratio	-1.06
Price To FCF	-8.32
Price To sales	0.93
EV / EBITDA	-43.05

2. Transcript Summary

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3. NewsRoom

LION ELECTRIC ANNOUNCES FURTHER WORKFORCE REDUCTION IN THE CONTEXT OF ONGOING CCAA PROCEEDINGS

Jan -03

Source:

Lion Electric files for creditor protection under CCAA

Dec -19

Source:

LION ELECTRIC OBTAINS CREDITOR PROTECTION UNDER CCAA

Dec -19

Source:

LION ELECTRIC FILES APPLICATION FOR CREDITOR PROTECTION UNDER THE CCAA

Dec -18

Source:

LION ELECTRIC ANNOUNCES EXPIRY OF COVENANT RELIEF PERIOD AND DEFAULTS UNDER CERTAIN OF ITS SENIOR DEBT INSTRUMENTS

Dec -17

Source:

LION ELECTRIC REACHES DEFINITIVE AGREEMENT IN RESPECT OF THE SALE OF INNOVATION CENTER LOCATED IN MIRABEL, QUÉBEC

Dec -05

Source:

EV maker Lion wins temporary creditor relief, halts US factory

Dec -01

Source:

NYSE to Commence Delisting Proceedings with Respect to the Warrants of Lion Electric (LEV.WS)

Nov -20

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (21.97%)

6. Segments

Electric Vehicles

Expected Growth: 21.97%

The Lion Electric Company's 21.97% growth in Electric Vehicles is driven by increasing government incentives and regulations favoring eco-friendly transportation, declining battery costs, rising consumer environmental awareness, and growing demand from logistics and public transportation companies seeking to reduce their carbon footprint.

7. Detailed Products

LionC

LionC is a zero-emission, all-electric urban bus designed for public transportation, offering a range of up to 250 miles on a single charge.

LionM

LionM is a medium-duty, all-electric truck designed for last-mile delivery, construction, and vocational applications, offering a range of up to 150 miles on a single charge.

LionA

LionA is an all-electric, Class 8 truck designed for long-haul transportation, offering a range of up to 400 miles on a single charge.

LionE

LionE is a comprehensive, end-to-end electrification solution for fleets, providing a range of charging infrastructure, energy management, and telematics services.

8. The Lion Electric Company's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for The Lion Electric Company is moderate due to the presence of alternative modes of transportation, such as gasoline-powered vehicles and public transportation.

Bargaining Power Of Customers

The bargaining power of customers for The Lion Electric Company is low due to the lack of negotiating power of individual customers and the company's strong brand reputation.

Bargaining Power Of Suppliers

The bargaining power of suppliers for The Lion Electric Company is moderate due to the presence of multiple suppliers and the company's ability to negotiate prices.

Threat Of New Entrants

The threat of new entrants for The Lion Electric Company is high due to the growing demand for electric vehicles and the increasing competition in the market.

Intensity Of Rivalry

The intensity of rivalry for The Lion Electric Company is high due to the presence of established competitors and the increasing competition in the market.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	48.79%
Debt Cost	3.95%
Equity Weight	51.21%
Equity Cost	17.66%
WACC	10.97%
Leverage	95.27%

11. Quality Control: The Lion Electric Company passed 3 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Manitowoc

A-Score: 4.4/10

Value: 8.5

Growth: 4.3

Quality: 4.3

Yield: 0.0

Momentum: 5.5

Volatility: 3.7

1-Year Total Return ->

Shyft Group

A-Score: 3.8/10

Value: 3.9

Growth: 2.7

Quality: 2.7

Yield: 3.0

Momentum: 5.5

Volatility: 5.3

1-Year Total Return ->

Lion Electric

A-Score: 3.2/10

Value: 9.6

Growth: 4.6

Quality: 3.2

Yield: 0.0

Momentum: 1.0

Volatility: 1.0

1-Year Total Return ->

Xos

A-Score: 3.2/10

Value: 9.0

Growth: 4.9

Quality: 2.8

Yield: 0.0

Momentum: 1.5

Volatility: 1.0

1-Year Total Return ->

Hydrofarm Holdings

A-Score: 2.8/10

Value: 10.0

Growth: 2.3

Quality: 2.7

Yield: 0.0

Momentum: 1.0

Volatility: 1.0

1-Year Total Return ->

UrbanGro

A-Score: 2.5/10

Value: 9.0

Growth: 3.1

Quality: 2.9

Yield: 0.0

Momentum: 0.0

Volatility: 0.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

16.26%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

10.97%

The Lion Electric Company - CA5362211040

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on LEV

1.c. Company Highlights

Cheaper

Weak Momentum

Lower Quality

Earnings Miss

Revenues Miss

Earnings Beats

More Volatile

Revenues Beats

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (21.97%)

6. Segments

Electric Vehicles

Expected Growth: 21.97%

7. Detailed Products

LionC

LionM

LionA

LionE

8. The Lion Electric Company's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: The Lion Electric Company passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

0.34$

Current Price

0.34$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA