$4.02 +0.06 (+1.52%) (As of 08/30/2024 08:54 PM ET)
- Price Target
- $3.71
Electric vehicle (EV) maker Lucid Group Inc. NASDAQ: LCID was once touted as a Tesla Inc. NASDAQ: TSLA killer with its sleek luxury designs and purportedly superior performance. The hype sent shares as high as $64.86 on February 16, 2021, but came crashing down to an all-time low of $2.29 on April 24, 2024. Recently, shares jumped 25% on its Q2 2024 vehicle delivery numbers, with volume hitting 167.8 million shares. This comes on the back of rival EV maker Rivian Automotive Inc. NASDAQ: RIVN.
Lucid Group operates in the Auto/Tires/Trucks sector and competes with EV makers such as Tesla, Rivian, and Polestar Automotive Holdings UK PLC NASDAQ: PSNY.
The Lucid Air and Gravity EV Models
The 4-door Lucid Air boosts impressive stats. The long-range electric sedan has an estimated EPA range of 516 miles, with a maximum horsepower of 1,234 and a zero to 60 mph time of 1.89 seconds. Its batteries can charge 200 miles in 12 minutes. All these vary by trim. Lucid Air was named the best luxury electric car by the US and World Report for 2024 for the third consecutive year. Lucid claims it's the longest range and fastest charging production car in the US market. It is the most efficient EV in its class as measured by kilowatt hours.
The Lucid Gravity is an electric SUV that can seat up to seven people. It can reach speeds of zero to 60 mph in under 3.5 seconds with a projected range of 440 mils and peaks at 800 horsepower. The dashboard features a curved 34-inch floating screen with a 6K display. Production is set to start later in 2024 with a total addressable market that is 6x larger than in 2023.
Could the Saudi Government Afford to Let Lucid Fail?
Through its Public Investment Funds (PIF) and affiliates, the Saudi government owns a 60% stake in Lucid. The investment is part of its strategy to diversify the economy beyond oil. Its latest investment through a PIF affiliate, Ayar Third Investment Co., bought $1 billion in convertible preferred stock, which has the option to convert into 280 million common shares. This also has the potential to dilute its 2.3 billion shares outstanding further. Investors believe that unlike Fisker Inc. NYSE: FSR, the Saudis won’t let Lucid go bankrupt.
Lucid’s Turnaround
Lucid undertook steps to curtail some of the bleeding in its business. Like the EV industry, Lucid is suffering from the waning interest in EVs. It reported a Q1 2024 EPS loss of 30 cents, which missed consensus estimates by 5 cents. Revenues grew 15.6% YoY to $172.74 million, slightly beating the consensus estimates of $172.74 million. The company produced $1,728 vehicles and is on track to produce around 9,000 vehicles for the year. Deliveries were 1,967 vehicles in the quarter, up 39% YoY. The company ended the quarter with $5.03 billion in liquidity.
Lucid CEO Peter Rawlings commented, “We surpassed 12,000 vehicles on the road in Q1, which takes us nicely past the critical threshold into boosting word-of-mouth awareness. And I am pleased with the 39.9% year-over-year uptick in sales in Q1 and with the momentum we're seeing here in April. I always offer caveats. We expect typical seasonal slowing in Saudi Arabia in Q2, and we expect typical seasonal slowing globally in Q3 as consumers go on vacation.”
LCID Stock Attempts to Complete a Cup Pattern
The daily candlestick chart on LCID illustrates an attempt to complete a cup pattern. This cup lip line formed at $5.31 on December 14, 2023, before shares plummeted to all-time lows of $2.29 on April 24, 2024. LCID stock staged a rally that accelerated on the deliveries news, causing shares to surge 25% to $.25 on July 12, 2024. The daily relative strength index (RSI) surged to the 85-band. Pullback support levels are at $3.62, $3.35, $2.80, and $2.55.
Lucid’s Road to Redemption Starts with Vehicle Deliveries
Lucid releases Q2 2024 production numbers early. It produced 2,110 vehicles and delivered 2,394 vehicles in the quarter. This was a sequential bump higher than the 1,728 vehicles produced in Q1 2024. Granted, it’s a drop in the bucket compared to Tesla’s Q2 2024 production of 410,831 and deliveries of 443,956 EVs. The full Q2 2024 earnings release is expected on August 5, 2024.
Lucid Group analyst ratings and price targets are at MarketBeat. There are 10 analyst ratings, seven of which are Holds and three of which are Sells.
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