Nikola slides 12% after JPMorgan downgrades to neutral given that the 'good news is priced in the stock'

• Nikola fell 12% on Friday after JPMorgan downgraded the firm to neutral from overweight, according to a note.
• The call from JPMorgan was "a tactical move" as much of the good news is priced into the stock.
• Nikola's steep decline on Friday came amid a broader decline in electric vehicle stocks like Tesla.
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Shares of Nikola dropped as much as 12% on Friday after JPMorgan downgraded the fuel-cell truck developer to neutral from overweight, according to a research note.

JPMorgan's drive to downgrade Nikola was "a tactical move" based more on the timing of future catalysts than the underlying fundamentals, the note said.

According to the bank, the "good news is now priced in the stock, so we step aside for now," the note said. The bank maintained its price target of $30, representing potential upside of 87% from Thursday's close.

Much of that good news includes evidence that the company is more focused on its goals and is passed the drama caused by founder and former CEO and chairman Trevor Milton.

Milton voluntarily stepped down from the company as chairman in late September, after a short-seller report from Hindenburg Research alleged that Milton and Nikola deceived investors. Nikola dismissed many of the claims raised in the report.

Nikola "has left much of the drama of 2020 behind," JPMorgan said.

But JPMorgan sees the Nikola's story exciting investors once again in mid or late 2021 if customer orders are announced, "and as the first FCEL prototype comes to life," the note said.

The decline in Nikola on Friday came amid a broader market sell-off in high-growth tech stocks that have been shunned by investors amid rising interest rates. Shares of Tesla were down as much as 13% on Friday.