Industrial Technology/Sustainability

Hyliion Holdings Corp. (HYLN)

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EQUITY RESEARCH Assumpon of Coverage

November 10, 2021
Assuming Coverage of HYLN; 3Q21 Earnings Recap
Price: $7.58
Price Target: $12.00 We assume coverage of HYLN with an Overweight Rang and a $12 price target.
Rang: Overweight Earning Highlights: The company reported 3Q21 cash and cash equivalents of $289.5M (vs.
$317.7M in Q2). This includes ST investments of $144.5M and LT investments of $155M.
Key Stascs:
HYLN now has >$588M to fund its current commercializaon plans for its powertrains (vs.
Symbol NYSE: HYLN
$617M in Q2).
52-Week Range $6.75 - $27.30
Market Cap ($M) 1,313.7 OPEX Guidance Lowered. Hyliion lowered its FY21 operang expenses guidance to
ADV (3 mo) 2,753,245 $110M-$120M (vs. prior $130M - $140M) due to delays in the ming of truck purchases.
Shares Out (M) 173.3 Supply Chain shortages are causing delays: Management noted that global supply chain
disrupons (shortage of semiconductors) are causing longer lead-mes for deliveries and
Research Analysts: have delayed some deliveries into early 2022. The company also menoned that they have
Andres Sheppard already placed orders for all vehicles needed in 2022 and are currently working to secure
212-428-5983 build slots for 2023.
Andres.Sheppard@cantor.com Hybrid EX Update. HYLN announced that it recently delivered its first Hybrid eX system to
Colton Zimmer Werner Enterprises. Recall that Hyliion officially launched its Hybrid eX powertrain soluon
212-829-5248 on 83121 & expects to begin recognizing revenue in 4Q21.
Colton.Zimmer@cantor.com
Hypertruck ERX Timeline: end of 2022. HYLN began a roadshow today & will be execung
ride-along events in Dec. HYLN expects to complete design verificaon and start on-road
REV ($M)
tesng in 1H22, and to begin winter tesng & controlled fleet vehicle deployments in 2H22.
FYE Dec 2020A 2021E 2022E
Secured a new 40-unit reservaon. HYLN announced that they have secured a 40-unit
1Q - $0.0A -
reservaon for the Hypertruck ERX from Mone Transport, (a carrier company in Texas).
2Q - $0.0A -
The purchase and sale of the 40 Hypertruck ERX units is sll subject to final agreement.
3Q - $0.0A -
4Q - $2.0E -
Addionally, the company also announced a partnership with GreenPath Logiscs to begin
Year $0.0 $2.0E $60.0 inial deployments of controlled fleet trials in their operaons.
Our Thoughts and Investment Thesis: We assume coverage of HYLN today (previously
EPS
covered by Josh Cohen) with an Overweight Rang (unchanged) and establish a new
FYE Dec 2020A 2021E 2022E $12 price target. Hyliion shares were weak today given the 3Q21 update. That said, we
1Q - $(0.10)A - view this as a transitory issue which is unlikely to negavely impact HYLN’s long-term
2Q - $(0.13)A -
monezaon ability, which we think is a key driver of value. We connue to like HYLN
3Q - $(0.15)A -
given its visible path to commercializaon and its early-mover advantage. The company’s
4Q - $(0.22)E -
Year $2.93 $(0.61)E $(0.92)
taccal and economical product offerings, which enjoy a robust re-fueling infrastructure
already in place, don't currently have much compeon elsewhere. Addionally, recall
that in HYLN’s iniaon, Cantor previously calculated a total addressable market (“TAM”)
for the company’s Hybrid soluon of $44B in the US, and $246B globally (not an annual
TAM, as the Hybrid soluon targets retrofing exisng Class 8 commercial vehicles). For
both TAM calculaons we exclude Class 8 vehicles that are not semi-tractor trailers, as
Hyliion’s soluons are not suitable for these types of vehicles. Separately, we reaffirm
Cantor’s previously calculated TAM for the Hypertruck ERX at $17B/yr in the US, and $94B/
yr globally (calculaon is based on new Class 8 commercial trucks sold each year). We
believe that with good execuon, HYLN can capture a significant market share here.
Valuaon: We reaffirm previous overweight rang, but we reduce our price target to $12
as we apply a more conservave approach to valuaon. We value the company using a
weighted blended approach with relave valuaons using EV/Revenue (60%), EV/EBITDA
(30%), and a discounted cash flow (10%). We apply a 1x and 2x discounts to EV/Revenue
and EV/EBITDA respecvely, and we apply a 2% terminal growth rate and a 14% cost of
capital in our DCF.

The Disclosure Secon may be found on pages 14 - 15.

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November 10, 2021

Valuaon

We reaffirm previous overweight rang, but we reduce our price target to $12 as we
apply a more conservave approach to valuaon. We value the company using a weighted
blended approach with relave valuaons using EV/Revenue (60%), EV/EBITDA (30%), and
a discounted cash flow (10%). We apply a 1x and 2x discounts to EV/Revenue and EV/
EBITDA respecvely, and we apply a 2% terminal growth rate and a 14% cost of capital in
our DCF.

Risks

Market Demand and Compeon

Ability to Successfully Commercialize Products
Connued Supply Shortages
Ability to Finalize Key Strategic Partnerships:

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November 10, 2021

Contents
Executive Summary .................................................................................................................................. 4
Product Overview ..................................................................................................................................... 6
TAM Review.............................................................................................................................................. 8
Financial Statements .............................................................................................................................. 10
Valuation ................................................................................................................................................ 13

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November 10, 2021

Executive Summary
We assume coverage of HYLN today with an Overweight Rating and a $12 price target. Hyliion is quickly
progressing to become a leading provider of electrified powertrain solutions for Class 8 commercial
vehicles, with the goal of reducing greenhouse gas (GHG) emissions, at the lowest total cost of ownership
(TCO), and without sacrificing performance. Its solutions are being developed to practically achieve these
objectives today, while having the flexibility to adapt to the rapidly changing landscape for long-haul
commercial vehicles.

Our Thoughts and Investment Thesis: We are assuming coverage of HYLN today (previously covered by
Josh Cohen) with an Overweight Rating (unchanged) and establishing a new $12 price target. Hyliion
shares were weak today due to this given the 3Q21 update. That said, we view this as a transitory issue
which is unlikely to negatively impact HYLN’s long-term monetization ability – which is a key driver of
value. We continue to like HYLN given its visible path to commercialization and its early-mover advantage.
The company’s tactical and economical product offerings, which enjoy a robust re-fueling infrastructure
already in place, don’t currently have much competition elsewhere. Additionally, recall that in the HYLN
initiation, Cantor previously calculated a total addressable market (“TAM”) for the company’s Hybrid
solution of $44B in the US, and $246B globally (not an annual TAM, as the Hybrid solution targets
retrofitting existing Class 8 commercial vehicles). For both TAM calculations we exclude Class 8 vehicles
that are not semi-tractor trailers, as Hyliion’s solutions are not suitable for these types of vehicles.
Separately, we reaffirm the previously calculated TAM for the Hypertruck ERX at $17B/yr in the US, and
$94B/yr globally (calculation is based on new Class 8 commercial trucks sold each year). We believe that
with good execution, HYLN can capture a significant market share here.

Supply Chain shortages are causing delays: Management noted that global supply chain disruptions
(shortage of semiconductors) are causing longer lead-times for deliveries and have delayed some
deliveries into early 2022. The company also mentioned that they have already placed orders for all
vehicles needed in 2022 and are currently working to secure build slots for 2023.

Earning Highlights: The company reported 3Q21 cash and cash equivalents of $289.5M (vs. $317.7M in
Q2). This includes ST investments of $144.5M and LT investments of $155M. HYLN now has > $588M to
fund its current commercialization plans for its powertrains (vs. $617M in Q2). OPEX Guidance Lowered.
Hyliion lowered its FY21 operating expenses guidance to $110M-$120M (vs. prior $130M - $140M) due
to delays in the timing of truck purchases.

Hybrid EX Update. HYLN announced that it recently delivered its first Hybrid eX system to Werner
Enterprises. Recall that Hyliion officially launched its commercial Hybrid eX powertrain solution on
8/31/21 and expects to begin recognizing revenue in 4Q21.

Hypertruck ERX Timeline – end of 2022. HYLN is kicking off the Hypertruck ERX roadshow today and will
be executing ride-along events in Dec. HYLN expects to complete design verification and start on-road
testing in 1H22, and to begin winter testing and controlled fleet vehicle deployments in 2H22.

Secured a new 40-unit reservation. The company announced today that they have secured a 40-unit
reservation for the Hypertruck ERX from Mone Transport, (a carrier company in Texas). The purchase and
sale of the 40 Hypertruck ERX units is still subject to final agreement. Additionally, the company also

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November 10, 2021

announced a partnership with GreenPath Logistics (located in Dallas, TX) to begin initial deployments of
controlled fleet trials in their operations.

Valuation: We reaffirm previous overweight rating, but we reduce our price target to $12 as we apply a
more conservative approach to valuation. We value the company using a weighted blended approach
with relative valuations using EV/Revenue (60%), EV/EBITDA (30%), and a discounted cash flow (10%). We
apply a 1x and 2x discounts to EV/Revenue and EV/EBITDA respectively, and we apply a 2% terminal
growth rate and a 14% cost of capital in our DCF.

Exhibit 1: Valuation

Method 1: Peer EV/Revenue (2023)

Hyliion - Revenue (2024E) $1,000 Using 2024 given we are using a comp multiple looking out two years and are so
Peer Median - EV/Revenue (2023) 2.1x
Discount applied 1.0x
Cantor Override - EV/Revenue 1.1x
One-Year EV Target $1,051
Cash (1Q22E) $415
Debt (1Q22E) $0
One Year-Market Cap Target $1,466
Share Count (2022E) 178
Price Target $8
Upside 8%

Method 2: Peer EV/EBITDA (2023)

View - EBITDA (2024E) $150 Using 2024 given we are using a comp multiple looking out two years and are so
Peer Median - EV/EBITDA (2023) 17.4x
Discount applied 2.0x
Cantor Override - EV/Revenue 15.4x
One-Year EV Target $2,295
Cash (1Q22E) $415
Debt (1Q22E) $0
One-Year Market Cap Target $2,710
Share Count (2022E) 178
Price Target $15
Upside 100%

Method 3: Discounted Cash Flows

WACC 14%
Terminal Growth Rate 2%
Implied Equity Value $4,140
Share Count (2022E) 178
Price Target $23
Upside 205%

Summary Price Target Upside Weighting WA Price Target WA Upside

Method 1: Peer EV/Revenue (2023) $8 8% 60% $4.95 5%
Method 2: Peer EV/EBITDA (2023) $15 100% 30% $4.57 30%
Method 3: Discounted Cash Flows $23 205% 10% $2.33 21%
Weighted Average Price Target 100% $12.00 57%

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November 10, 2021

Product Overview
Hybrid eX: Hyliion’s Hybrid solution is ideal for Class 8 commercial vehicles, in our opinion, and is
compatible with both diesel and natural gas engines. This solution retrofits the vehicle with an electrified
powertrain system in order to reduce operating costs, decrease greenhouse gas (GHG) emissions, and
improve vehicle performance. The system utilizes a battery which is charged by regenerative braking and
downhill deceleration, and discharged to provide additional horsepower and torque, thereby reducing
fuel usage and related GHG emissions. The incremental horsepower and torque become especially
important to existing natural gas-powered commercial vehicles, which can struggle with heavy loads and
steep inclines. The Hybrid system’s battery pack can also be utilized as an auxiliary power unit to supply
electricity for in-cab devices and air conditions, which helps to reduce or eliminate idling. The Hybrid
system was designed to be brand and engine agnostic, can be installed on most Class 8 commercial
vehicles, and requires no additional driver training. The Hybrid solution is comprised of a proprietary
battery system, thermal management unit, and electric axle.

In August 2021, Hyliion unveiled the new and improved Hybrid eX. The installation process for the new
design was significantly streamlined by consolidating components into a larger battery box. The new
version also delivers over-the-air updates more efficiently as a result of improved software and cloud
connectivity. This will allow Hyliion to deliver the latest version of their software and performance
algorithms to customers. We believe Hyliion’s Hybrid eX solution represents an attractive option for fleet
operators to reduce operating costs and the carbon intensity of their fleets.

Exhibit 2: HYLN Hybrid Electric

Source: Hyliion Holdings

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November 10, 2021

Hypertruck ERX: Hyliion’s Hypertruck ERX solution is an electric powertrain system that builds on its
Hybrid solution, providing a larger version of its proprietary battery system, and with a focus on
integration into new vehicle builds. The system includes an electric generator powered by the customer’s
choice of fuel, its primary electric traction drive system, its software management suite, and CoPilot in-
cab driver display. The system works by pairing the fully electric powertrain with its battery system, which
is recharged by an onboard generator, with a focus on natural gas as a source of fuel. This system fully
replaces the traditional powertrain in Class 8 commercial vehicles. Like the Hybrid solution, the Hypertruck
ERX is being designed for installation on most major Class 8 commercial vehicles, and aims to reduce
operating costs, decrease greenhouse gas (GHG) emissions, and improve vehicle performance. Its
Hypertruck ERX system will initially be used in conjunction with natural gas, including both compressed
natural gas (CNG) and renewable natural gas (RNG), leveraging around 700 geographically-dispersed
public fueling stations for Class 8 commercial vehicles across the United States, and providing sufficient
infrastructure for long-haul trucking today. Customers interested in utilizing a source of fuel with a
negative carbon intensity will have the ability to utilize RNG, which is a widely available growing source of
fuel. Hyliion is also designing its Hypertruck ERX solution to allow for the use of any other available fuel
generator to recharge the battery system without needing to change any components of its electric
powertrain system. This includes hydrogen fuel cells, microturbines, and diesel or gasoline generators.
This flexibility should enable it to effectively adapt to the energy transition as it occurs within commercial
vehicles, reducing the uncertainty around commodity prices, fuel source availability, customer
preferences, and/or regulatory agendas.

Exhibit 3: HYLN Hypertruck ERX Exhibit 4: Hypertruck ERX –

Technological Components

Source: Hyliion Holdings Source: Source: Hyliion Holdings Hyliion

Holdings

HYLN’s in-house battery lab enables it to develop its own proprietary battery systems, which is a central
component to its two powertrain systems. The company also intends to use these capabilities to develop
and sell its battery systems to customers for use in their own applications, such as lower class and specialty
commercial vehicles. Its batteries currently utilize a lithium-titanate-oxide (LTO) chemistry which has been
shown to recharge at a faster rate vs. other lithium-ion batteries. Its systems also utilize advanced thermal
management capabilities in order to increase life and cycle count. The company also expects to separately
sell its proprietary Battery Management System (BMS), which uses intelligence to monitor and balance
cells to maximize safety and performance. Its BMS has been designed with the flexibility to support all
lithium-ion chemistries and a wide range of system sizes (i.e., 12v to 800v).

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TAM Review

Hyliion’s market opportunity is very large, which is best represented by the TAM calculations below,
displayed in exhibit 5. The total addressable market (“TAM”) for the Hypertruck ERX is calculated at $17B
per year in the United States and $94B per year globally. For the Hypertruck ERX, the calculation is based
on Cantor’s calculation on new Class 8 commercial trucks sold each year given the system is being
positioned for new vehicle builds. For Hyliion’s Hybrid solution, the TAM is calculated at $44B for the
United States and $246B globally. Keep in mind that this is not an annual TAM, as the Hybrid solution is
being positioned for retrofitting existing Class 8 commercial vehicles.

For both TAM calculations Class 8 vehicles that are not semi-tractor trailers are excluded, as Hyliion’s
solutions are not suitable for these types of vehicles. It is also important to note that the Class 8
commercial vehicle population is expected to grow 4.5% annually from 2020 to 2024(from Act Research),
representing a growing opportunity for Hyliion.
Exhibit 5: Cantor’s TAM Estimates

Hypertruck ERX United States Globally

New Class 8 Semi Tractor Trailer Vehicles Per Year 170,000 944,000
Revenue Generated Per Unit $100,000 $100,000
Total Addressable Market - Per Year ($M) $17,000 $94,400

Hybrid United States Globally

New Class 8 Semi Tractor Trailer Vehicles Per Year 170,000 944,000
Average Useful Life (Years) 9 9
Total Class 8 Semi Trucks in Operation 1,530,000 8,496,000
Revenue Generated Per Unit $29,000 $29,000
Total Addressable Market ($M) $44,370 $246,384

Source: Cantor Fitzgerald, Hyliion Holdings

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RNG Infrastructure
The existing infrastructure for natural gas fueling is robust, providing an immediate advantage vs. battery
electronic vehicles (BEV) and hydrogen fuel cell electronic vehicles (FCEV), eliminating the time, cost, and
uncertainty in building out these respective fueling infrastructures. The United States Department of
Energy reported almost 1,600 compressed natural gas (CNG) fueling stations in the United States as of the
end of 2019. Importantly, this mature fueling infrastructure can also be utilized to supply renewable
natural gas (RNG), enabling fleet operators to increase their utilization of RNG as supply continues to
grow. This compares to only 61 hydrogen fueling stations and no record of electric charging stations for
Class 8 commercial vehicles. In exhibit 6, we show the broad and mature fueling infrastructure for
CNG/RNG vs a modest and concentrated fueling infrastructure for hydrogen in exhibit 7. In addition, the
transmission infrastructure for natural gas (i.e., pipelines) is also very mature vs. an almost nonexistent
transmission infrastructure for hydrogen. While the infrastructure for hydrogen is still in its infancy, there
is still potential for it to command a meaningful share of the future long-haul mobility market, which is
why Hyliion is designing its solutions to be fuel agnostic. We believe this not only positions Hyliion’s
solution to be an ideal near-term solution, but also an effective long-term solution that can flexibly change
with technological innovation and customer preference.

Exhibit 6: Public Fueling Stations – CNG/RNG Exhibit 7: Public Fueling Stations - Hydrogen

Source: Source:
https://afdc.energy.gov/fuels/natural_gas_locations.html#/ https://afdc.energy.gov/fuels/natural_gas_locations.html#/find/n
earest?fuel=HY

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Financial Statements
Income Statement
Hyliion (HYLN) 2019 2020 2021E Full Year
$ Millions 2019 2020 1Q21A 2Q21A 3Q21A 4Q21E 2021E 2022E 2023E 2024E 2025E
Net Revenues 0 0 0 0 0 2.0 2.0 60.0 500.0 1,000.0 1,600.0
Guidance 1 8 344 1019 2091

Cost of Revenue 0.0 0.0 0.0 0.0 0.0 2.2 2.2 54.0 375.0 700.0 1,040.0

Gross Profit 0.0 0.0 0.0 0.0 0.0 (0.2) (0.2) 6.0 125.0 300.0 560.0
Gross Margin na na na na 0% -10% -10% 10% 25% 30% 35%

Operating Expenses:
Research and Development 9.3 12.6 9.3 13.4 18.2 30.0 70.9 120.0 122.0 124.0 126.0
Selling, General, and Administrative 2.7 9.6 7.4 10.1 8.7 8.7 34.8 50.0 54.0 58.0 63.0
Extraordinary 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Expenses (GAAP) 12.0 22.2 16.7 23 26.810 38.7 105.6 170.0 176.0 182.0 189.0
Core Expenses 12.0 22.2 16.7 23.4 26.8 38.7 105.6 170.0 176.0 182.0 189.0
Guidance 130-140

Operating Income (GAAP) (12.0) (22.2) (16.7) (23.441) (26.8) (38.9) (105.8) (164.0) (51.0) 118.0 371.0
Core Operating Income (12.0) (22.2) (16.7) (23.441) (26.8) (38.9) (105.8) (164.0) (51.0) 118.0 371.0

Core EBITDA (inc. SBC) (11.0) (21.3) (16.5) (23.230) (26.6) (38.1) (104.4) (154.0) (36.0) #REF! #REF!
Core EBITDA Margin na na na na na na na na -7% #REF! #REF!
Adjusted Core EBITDA (ex. SBC) (12.0) (22.2) (15.0) (21.313) (26.0) (37.6) (99.9) (147.5) (27.5) 149.5 410.5
Adjusted Core EBITDA Margin na na na na na na na na -5% 15% 26%

Financial Income (Expense) (3.3) (5.5) 0.2 0.20 0.2 0.0 0.6 0.6 0.6 0.6 0.6
Other Income (Expense) 1.1 351.8 0.0 0.00 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Pre-Tax Income (GAAP) (14.1) 324.1 (16.6) (23.244) (26.615) (38.9) (105.3) (163.4) (50.4) 118.6 371.6
Tax Expense (Benefit) 0 0 0.0 0.0 0.0 0.0 0 0 0 0 85
Tax Rate 0% 0% 0.0% 0.0% 0.0% 0.0% 0% 0% 0% 0% 23%
Net Income (GAAP) (14.1) 324.1 (16.6) (23.2) (26.615) (38.9) (105.3) (163.4) (50.4) 118.6 286.1

Core Net Income (15.3) (27.6) (16.6) (23.2) (26.615) (38.9) (105.3) (163.4) (50.4) 118.6 286.1

Diluted EPS (GAAP) -$0.16 $2.93 -$0.10 -$0.13 -$0.15 -$0.22 -$0.61 -$0.92 -$0.28 $0.63 $1.48
Core Diluted EPS -$0.18 -$0.25 -$0.10 -$0.13 -$0.15 -$0.22 -$0.61 -$0.92 -$0.28 $0.63 $1.48

Weighted Avg Diluted Shares 87 111 170 172 173 174 173 178 183 188 193
Share Increase 24 1 2 1 1 62 5 5 5 5

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Balance Sheet
Hyliion (HYLN) 2019A 2020A 2021E Full Year
$ Millions 2019A 2020A 1Q21A 2Q21A 3Q21A 4Q21E 2021E 2022E 2023E 2024E 2025E
Assets
Cash and Equivalents 6 390 335 318 289 226 226 86 (21) 31 214
Accounting Receivables 0 0 0 0 0 1 1 15 115 235 395
Prepaid Expenses and Other 0 21 4 4 6 7 7 5 6 9 14
Inventory 0 0 0 0 0 1 1 6 32 72 128
Short-Term Investments 0 202 145 140 144 144 144 144 144 144 144
Total Current Assets 7 612 483 462 440 379 379 256 276 491 895

Property Plant & Equipment 2 1 1 2 3 5 5 15 30 50 75

Operating Lease Right of Use Assets 5 5 5 9 8 8 8 8 8 8 8
Intangible Assets 0 0 0 0 0 0 0 0 0 0 0
Other Assets 0 0 0 0 1 1 1 1 1 1 1
Long-Term Investments 0 36 152 160 155 185 185 185 185 185 185
Total Assets 14 655 642 632 607 579 579 466 500 735 1,164

Liabilities & Share Equity

Accounts Payable 1 2 2 8 8 7 7 15 53 116 199
Current Portion of Operating Lease 1 1 1 1 1 1 1 1 1 1 1
Accrued Expenses and Other 10 6 5 6 8 10 10 15 22 32 43
Total Current Liabilities 12 9 8 15 16 18 18 31 76 148 243

Operating Lesae Liabilities 5 5 5 9 9 9 9 9 11 14 17

Long-Term Debt 15 1 0 0 0 0 0 0 0 0 0
Total Liabilities 32 15 13 24 25 26 26 40 87 162 260

Common Stock 0 0 0 0 0 0 0 0 0 0 0
Additional Paid-In Capital 31 365 371 373 374 382 382 418 457 498 543
Accumulated Deficit/Retained Earnings (49) 275 259 235 209 170 170 6 (44) 75 361
Total Shareholders Equity (18) 640 630 609 583 552 552 425 413 573 904

Total Liabilities & Shareholders' Equity 14 655 642 632 607 578 578 465 500 735 1,164
Check $ - $ - $ - $ - $ - $ 1 $ 1 $ 1 $ 1 $ 1 $ 1

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Cash Flow Statement

Hyliion (HYLN) 2019 2020 2021E Full Year
$ Millions 2019 2020 1Q21A 2Q21A 3Q21A 4Q21E 2021E 2022E 2023E 2024E 2025E
Cash Flow From Operations
Net Income (Loss) (14) 324 (17) (23) (27) (39) (105) (163) (50) 119 286
Adjustments to Net Income:
Depreciation and Amortization 1 1 0 0 0 1 1 10 15 20 25
Share-Based Compensation 0 0 2 2 1 1 5 7 9 12 15
Non-Cash Lease Expense 1 1 0 0 0 0 1 0 0 0 0
Other Adjustments 2 (346) 0 1 0 0 1 0 0 0 0

Working Capital:
Accounts Receivable (0) 0 0 (0) (0) (1) (1) (13) (100) (120) (160)
Prepaid Expenses & Other (0) (8) 1 4 (1) (1) 2 1 (1) (3) (6)
Inventory 0 0 0 0 0 (1) (1) (6) (26) (41) (56)
Other Assets 0 0 0 0 0 0 0 0 0 0 0
Accounts Payables (1) 1 0 6 (0) (0) 5 8 38 63 83
Accrued Expenses and Other (0) 6 3 (3) 1 2 3 5 7 9 11
Operating Lease Liabilities (1) (1) (0) (0) (0) 0 (0) 1 2 3 4
Total Non-Cash Adjustments 3 (347) 6 10 1 0 17 13 (56) (57) (83)
Cash From Operating Activities (11) (23) (11) (13) (26) (39) (89) (150) (107) 62 203
(50)
Cash Flow From Investing
Capital Expenditures (0) (0) (0) (1) (1) (3) (5) (20) (30) (40) (50)
Proceeds from Sale of P&E 0 0 0 0 0 0 0 0 0 0 0
Purchase of Investments 0 (238) (219) (20) (30) (30) (298) 0 0 0 0
Proceeds from sale of Investments 0 0 160 16 29 0 205 0 0 0 0
Other 0 0 0 (0) 0 0 (0) 0 0 0 0
Cash Used in Investing Activities (0) (238) (60) (4) (2) (33) (99) (20) (30) (40) (50)

Cash Flow From Financing

Proceeds from Exercise of Warrants 0 125 16 0 0 0 16 0 0 0 0
Proceeds from PPP Loan 0 1 (1) 0 0 0 (1) 0 0 0 0
Proceeds from Exercise of Options 0 0 0 0 0 8 8 30 30 30 30
Proceeds from Covertible Notes 17 3 0 0 0 0 0 0 0 0 0
Repayments on Lease Obligations (0) (1) (0) 0 0 0 0 0 0 0 0
SPAC and PIPE Financing 0 516 0 0 0 0 0 0 0 0 0
Cash Used in Investing Activities 17 645 16 0 0 8 23 30 30 30 30

Effect of FX Changes on Cash 0 0 0 0 0 0 0 0 0 0 0

Net Change in Cash 5 383 (55) (17) (28) (64) (164) (140) (107) 52 183

Core Free Cash Flow (11) (23) (11) (14) (27) (42) (94) (170) (137) 22 153
Period-End Cash 6 390 335 318 290 226 226 86 (21) 31 214

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Valuation
Valuation. We reaffirm previous overweight rating, but we reduce our target price to $12 as we apply a
more conservative approach to valuation. We value the company using a weighted blended approach
with relative valuations using EV/Revenue (60%), EV/EBITDA (30%), and a discounted cash flow (10%). We
apply a 1x and 2x discounts to EV/Revenue and EV/EBITDA respectively, and we apply a 2% terminal
growth rate and a 14% cost of capital in our DCF.

Method 1: Peer EV/Revenue (2023)

Hyliion - Revenue (2024E) $1,000 Using 2024 given we are using a comp multiple looking out two years and are solving
Peer Median - EV/Revenue (2023) 2.1x
Discount applied 1.0x
Cantor Override - EV/Revenue 1.1x
One-Year EV Target $1,051
Cash (1Q22E) $415
Debt (1Q22E) $0
One Year-Market Cap Target $1,466
Share Count (2022E) 178
Price Target $8
Upside 8%

Method 2: Peer EV/EBITDA (2023)

View - EBITDA (2024E) $150 Using 2024 given we are using a comp multiple looking out two years and are solving
Peer Median - EV/EBITDA (2023) 17.4x
Discount applied 2.0x
Cantor Override - EV/Revenue 15.4x
One-Year EV Target $2,295
Cash (1Q22E) $415
Debt (1Q22E) $0
One-Year Market Cap Target $2,710
Share Count (2022E) 178
Price Target $15
Upside 100%

Method 3: Discounted Cash Flows

WACC 14%
Terminal Growth Rate 2%
Implied Equity Value $4,140
Share Count (2022E) 178
Price Target $23
Upside 205%

Summary Price Target Upside Weighting WA Price Target WA Upside

Method 1: Peer EV/Revenue (2023) $8 8% 60% $4.95 5%
Method 2: Peer EV/EBITDA (2023) $15 100% 30% $4.57 30%
Method 3: Discounted Cash Flows $23 205% 10% $2.33 21%
Weighted Average Price Target 100% $12.00 57%

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November 10, 2021

Company Descripon
Hyliion Holdings (“Hyliion”) is working towards becoming a leading provider of electrified powertrain soluons within the Class 8
commercial vehicle industry, with the goal of reducing greenhouse gas (GHG) emissions, at the lowest total cost of ownership (TCO).
The company’s soluons ulize its proprietary baery systems, fully integrated electric motors, control soware, and data analycs, to
either augment or fully replace tradional diesel and natural gas fueled powertrains. Hyliion’s Hybrid system can both retrofit exisng
in-service commercial vehicles and be installed during inial assembly, prior to entering fleet service. Its Hybrid System is currently being
tested with prospecve customers, having already accumulated millions of real-world miles with Class 8 commercial vehicles, providing
vast amounts of valuable data. The company’s Hypertruck ERX system is being posioned to replace the tradional powertrain in new
vehicles, offering Class 8 commercial vehicle owners and operators a net carbon negave electrified powertrain opon, when using
renewable natural gas (RNG). This soluon is currently under development, leveraging the operang data from its Hybrid system, with
vehicles under construcon for tesng and validaon.

Disclosures Appendix
Analyst Cerficaon
The analyst primarily responsible for this research report, and whose name appears on the front cover, cerfies that: (i) all of the views expressed in this
research report accurately reflects his or her personal views about any and all of the subject securies or issuers featured in this report; and (ii) no part
of any of the research analyst’s compensaon was, is, or will be, directly or indirectly related to the specific recommendaons or views expressed by the
research analyst in this report.

Legal Disclosures
Lead or Co-manager: Cantor Fitzgerald and/or its affiliates, has acted as lead or co-manager in a public offering of equity and/or debt securies for Hyliion
Holdings Corp. within the last 12 months
Investment banking (last 12 months): Cantor Fitzgerald and/or its affiliates has received compensaon for investment banking services in the last 12
months from Hyliion Holdings Corp..
Investment banking (next 3 months): Cantor Fitzgerald and/or its affiliates, expect to receive, or intend to seek, compensaon for investment banking
services within the next three months from all of the companies referenced within this report.
Cantor Fitzgerald and/or its affiliates is a market maker in Hyliion Holdings Corp..
Cantor Fitzgerald's rang system
Overweight/OW: We expect the stock’s total return to exceed 15% over the next 12 months. For the purpose of calculang the percentage of subject
companies within the Buy, Hold, and Sell categories for whom Cantor Fitzgerald has provided investment banking services within the previous 12 months,
an Overweight rang equates to a Buy rang.
Neutral/N: We expect the stock’s total return to be between -10% and 15% over the next 12 months. For the purpose of calculang the percentage of
subject companies within the Buy, Hold, and Sell categories for whom Cantor Fitzgerald has provided investment banking services within the previous 12
months, a Neutral rang equates to a Hold rang.
Underweight/UW: We expect the stock’s total return to fall below -10% over the next 12 months. For the purpose of calculang the percentage of subject
companies within the Buy, Hold, and Sell categories for whom Cantor Fitzgerald has provided investment banking services within the previous 12 months,
an Underweight rang equates to a Sell rang.
Not Covered/NC: Cantor Fitzgerald does not provide an investment opinion or does not provide research coverage on this stock.
Not Rated/NR: We are not currently carrying a rang on this stock. Rang and esmates are under review. The NR rang does not equate to an Overweight,
Neutral, or Underweight rang and thus is not counted in the calculaon of the percentage of subject companies within these three categories for whom
Cantor Fitzgerald has provided investment banking services within the previous 12 months.
Performance parameters should be interpreted flexibly as general guidelines relang to performance over a twelve-month period and are not intended to
be influenced by short-term share price volality. Performance in this context is evaluated in terms of total absolute return.
Total return is defined as the sum of (1) the percentage difference between the target price and the current price and (2) the expected dividend yield of
the stock.
Other Disclosures
This report is for informaonal purposes only and is based on publicly available data believed to be reliable, but no representaon is made that such data
are accurate or complete. Opinions and projecons contained herein reflect our opinion as of the date of this report and are subject to change. Pursuant
to Cantor Fitzgerald's policy, the author of this report does not own shares in any company he/she covers.

Cantor Fitzgerald and the Cantor Fitzgerald logo are trademarks or registered trademarks of Cantor Fitzgerald Securies or its affiliates in the U.S. and
other countries. Other trademarks appearing herein are the property of their respecve owners. Neither Cantor Fitzgerald Securies nor its affiliates are
associated with or affiliated with such third pares.
14
 R
November 10, 2021

This material is being presented solely as instuonal communicaons and is not meant to be viewed as a complete fundamental analysis of any security.
This material may offer recommendaons and strategies which are shorter term in nature. If the material contains analysis, it may be narrowly focused, and
may be based either purely on quantave models or other unique factors such as market supply/demand factors surrounding potenal market moving
events. When making an investment decision this informaon should be viewed as just one factor in your investment decision process. Past performance
should not be taken as an indicaon or guarantee of future results.

Disclosures for UK investors

This material is only intended for use by eligible counterpares or professional clients who fall within arcles 19 or 49 of the Financial Services and Markets
Act 2000 (Financial Promoon) Order 2001. None of the investments or investment services menoned or described herein are available to other persons
in the U.K and in parcular are not available to "retail clients” as defined by the rules of the FCA.
Disclosure for Canadian Instuonal Investors
This research report was prepared by analysts of Cantor Fitzgerald & Co. and not by Cantor Fitzgerald Canada Corporaon. As a result, this report has not
been prepared subject to Canadian Disclosure requirements. Cantor Fitzgerald Canada may distribute research reports prepared by its affiliates.
Risks
The financial instruments discussed in this report may not be suitable for all investors and investors must make their own investment decisions based on
their specific investment objecves. Past performance should not be taken as an indicaon or guarantee of future performance. The price, value of and
income from, any of the financial instruments featured in this report can rise as well as fall and be affected by changes in economic, financial and polical
factors. If a financial instrument is denominated in a currency other than the investor's currency, a change in exchange rates may adversely affect the price
or value of, or income derived from, the financial instrument, and such investors effecvely assume currency risk. In addion, investors in securies such
as ADRs, whose value is affected by the currency of the home market of the underlying security, effecvely assume currency risk.

Rating and Price Target History for: Hyliion Holdings Corp. (HYLN) as of 11-09-2021
07/06/21 08/06/21
I:1:$17 NC:NA
60
50
40
30
20
10
0
Q3 2019 Q1 Q2 Q3 2020 Q1 Q2 Q3 2021 Q1 Q2 Q3 2022

I = Initiated; 1 = Overweight/OW or before 12/14/16; B = BUY; 2 = Neutral or before 12/14/16; H = HOLD;

3 = Underweight/UW or before 12/14/16; S = SELL; SP = SPECULATIVE BUY before 12/14/16; NR = Not Rated; D = Dropped
Powered by BlueMatrix

Distribuon of Rangs/Investment Banking Services (IB) as of 111021

Cantor
IB Serv./Past 12 Mos.
Rang Count Percent Count Percent
BUY [1B] 226 85.93 171 75.66
HOLD [2] 36 13.69 15 41.67
SELL [SL/3] 1 0.38 0 0.00
(1)

Addional informaon available on request. Copyright (C) Cantor Fitzgerald 2021

15
U.S. Equity Research Analysts & Management

Director of Equity Research Large Cap Pharma & Biopharma Medical Devices & Supplies
Michael Rietbrock Louise Chen Brandon Folkes, CFA
212-428-5934 212-915-1794 212-294-8081
Mike.Rietbrock@cantor.com Louise.Chen@cantor.com Brandon.Folkes@cantor.com

BIOTECH/HEALTHCARE Carvey Leung CANNABIS

212-915-1917
Biopharma Pablo Zuanic
Carvey.Leung@cantor.com
Brandon Folkes, CFA 212.915.1057
212-294-8081 Pablo.Zuanic@cantor.com
Wayne Wu
Brandon.Folkes@cantor.com
212-294-7879
CONSUMER
Wayne.Wu@cantor.com
Biotechnology Pablo Zuanic
Alethia Young Jennifer Kim 212.915.1057
Head of Healthcare Research 212-829-4860 Pablo.Zuanic@cantor.com
212-359-8739 Jennifer.Kim@cantor.com
Alethia.Young@cantor.com SPACs
Life Science Tools & Diagnostics Alec Paniagua
Emily Bodnar 212-359-8706
Charles C. Duncan, Ph.D.
212-610-3604 Alec.Paniagua@cantor.com
212-915-1236
Emily.Bodnar@cantor.com
Charles.Duncan@cantor.com
TECHNOLOGY
Charles C. Duncan, Ph.D.
212-915-1236 Pete Stavropoulos, Ph.D. Consumer Internet
Charles.Duncan@cantor.com 212-915-1966 Benjamin Sherlund
Pete.Stavropoulos@cantor.com 212-359-8721
Kristen Kluska Benjamin.Sherlund@cantor.com
212-915-1927 Steven Halper
Kristen.Kluska@cantor.com 212-915-1240
Steven.Halper@cantor.com Financial Technology
Brian Cheng Josh Siegler
212-428-5953 Joseph Downing 212-428-5960
Brian.Cheng@cantor.com 212-294-8016 Josh.Siegler@cantor.com
Joseph.Downing@cantor.com
Pete Stavropoulos, Ph.D. Industrial Technology/Sustainability
212-915-1966 Managed Care
Andres Sheppard
Pete.Stavropoulos@cantor.com Steven Halper 212-428-5983
212-915-1240 Andres.Sheppard@cantor.com
Li Watsek Steven.Halper@cantor.com
212-915-1221
Li.Watsek@cantor.com Joseph Downing Colton Zimmer
212-294-8016 212-829-5248
Joseph.Downing@cantor.com Colton.Zimmer@cantor.com
Healthcare IT
Steven Halper
212-915-1240
Steven.Halper@cantor.com

Joseph Downing
212-294-8016
Joseph.Downing@cantor.com