Lilium’s Hold Rating Maintained Amid Funding and Future Milestone Considerations

Itay Michaeli, an analyst from Citi, maintained the Hold rating on Lilium (LILM – Research Report). The associated price target is $1.00.

Itay Michaeli has given his Hold rating due to a combination of factors affecting Lilium’s current financial position and future prospects. The update of the Lilium model with recent disclosures, such as the 20-F filing, has been considered, and it includes revised estimates of the company’s cash usage and funding needs. While long-term adjusted EBITDA estimates remain largely consistent with previous predictions, the price target has been adjusted from $1.1 to $1.0, factoring in a slightly higher discount rate to account for near-term funding risks as the company’s cash requirements are anticipated to grow within the year. Michaeli acknowledges that the risk/reward profile for Lilium appears relatively balanced at this point, which supports the decision to maintain a Hold rating.

Key deliverables for Lilium in 2024 are crucial in supporting Michaeli’s outlook, including securing additional funding, gaining commercial and customer traction, and achieving development milestones, all leading towards a manned flight by the end of the year. He notes that Lilium has executed well in 2023 and is on track for planned customer deliveries in 2026, acknowledging the recent commencement of battery pack production. However, with an expected increase in spending due to heightened testing and production activities, the focus remains on the company’s liquidity runway, its ability to gain customer momentum, and the successful completion of essential development milestones. These factors collectively underpin Michaeli’s rationale for the Hold recommendation on Lilium’s stock.

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Lilium (LILM) Company Description:

Qell Acquisition Corp is a blank check company.