Proterra Stock Sank in the SPAC Selloff. Now the Electric Bus Maker Looks Like a Bargain.

Proterra Greenville Facility

Courtesy of Proterra

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Proterra

would seem to have a lot going for it. The electric-vehicle technology company operates in a hot sector and has avoided head-on competition with a crowded field, including,

Tesla
.
It already has products and sales, unlike many EV companies, and profits should come reasonably soon. In fact, it’s the leader in a niche that it has almost to itself: electric buses.

Yet, for all of that, 2021 was a bumpy road for the Burlingame, Calif.-based company, whose stock, at around $9, is down 20% for the past year, compared to a drop of 9% for an index of small-cap growth stocks.

Proterra (ticker: PTRA) has one big problem: It merged with a SPAC in mid-June in order to go public, and has seen its share price tumble as investors sold off SPACs at the end of the year. Proterra dropped 21% last month, hitting a 52-week low on Dec. 20. The shares now trade below their $10 price at the SPAC merger. That often signals deeper troubles, but at Proterra, it may spell opportunity for investors.

Proterra’s main business is electric city buses, the kind used in short-distance bus services, often in urban areas, a growing market with only a few competitors, such as

NFI Group’s

(NFI.Canada) New Flyer. Proterra has about 50% of the developing market.

The company produced its first bus in 2010 and delivered 52 in the third quarter of 2021, up from 33 a year earlier. Roughly 5,000 to 6,000 transit buses are sold annually in North America, so there’s upside as battery-powered vehicles take market share. The company’s sales in 2021 should amount to about $243 million, with some 80% coming from buses. Fourth-quarter sales, due to be reported in…

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