Solid Power (SLDP): Evaluating Valuation After New BMW and Samsung SDI Battery Partnership Announcement

Solid Power (SLDP) just revealed a new partnership with Samsung SDI and BMW to develop a demonstration vehicle powered by all-solid-state battery technology. This collaboration could accelerate efforts to commercialize advanced batteries for the automotive sector.

See our latest analysis for Solid Power.

Solid Power's momentum has been hard to ignore: while shares dipped 3.4% on the latest session, they still boast a 21.2% share price return over the past month and an eye-popping 243% return year-to-date. When you look at the total shareholder return, the story is even stronger, up nearly 570% in the past year alone. These gains have accelerated on the back of major deals like the BMW and Samsung SDI collaboration, and come despite recent reports of quarterly sales softening and ongoing net losses. Overall, investors appear focused on the company's long-term battery tech potential rather than near-term volatility.

If this battery breakthrough has you rethinking where innovation is happening, now is a great time to see what’s next in the auto space with our hand-picked See the full list for free.

With Solid Power’s stock surging and current prices sitting well above analyst targets, the pressing question now is whether there is real value left for investors, or if the market is already baking in future success.

Most Popular Narrative: 77.5% Overvalued

With Solid Power’s most watched narrative implying a fair value of $4.00, the current share price of $7.10 sits significantly above that mark. This gap reflects very optimistic expectations. It is a dynamic that has investors weighing whether future breakthroughs are fully priced in or if there is meaningful upside left on the table.

Significant ongoing operating losses and high capital expenditures required for pilot manufacturing lines and technology development could sustain elevated cash burn, with investors possibly underestimating the time and cost needed to achieve profitable scale, posing risks to future net margins and eventual earnings growth.

Read the complete narrative.

Want to know the assumptions powering this premium? This narrative banks on rapid revenue growth, a shift to positive margins, and a rare future PE. Find out which high-stakes forecasts set Solid Power’s fair value above and beyond the norm. The surprising details are just a click away.

Result: Fair Value of $4.00 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, strong OEM partnerships or a breakthrough in scaling up manufacturing could shift prospects and quickly invalidate the case for prolonged overvaluation.

Find out about the key risks to this Solid Power narrative.

Build Your Own Solid Power Narrative

If the consensus doesn't match your viewpoint or you want to dig into the details yourself, you can build your own perspective on Solid Power in just a few minutes. Do it your way

A great starting point for your Solid Power research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

Why limit yourself to just one opportunity when the next big winner could be close at hand? Unlock fresh investment themes that might fit your goals.

• Boost your portfolio’s income potential with steady picks linked to these 15 dividend stocks with yields > 3% offering high yields and consistent payouts.
• Tap into innovation driving the future of healthcare by uncovering promising trends within these 32 healthcare AI stocks that are changing patient care forever.
• Seize value opportunities with companies trading below their true worth using these 855 undervalued stocks based on cash flows rooted in fundamental cash flow analysis.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com