Lucid Group, Inc. (NASDAQ: LCID) saw its stock price decline 1% on Tuesday, closing at $2.45, just above its intraday low of $2.42. Trading volume was significantly lower than average, with 18.3 million shares changing hands—a 66% drop from the stock’s average daily volume of 54.6 million shares.
Wall Street’s Mixed Sentiment: Uncertainty Looms Over Lucid’s Future
Despite Lucid’s ambition to establish itself as a dominant player in the electric vehicle (EV) market, Wall Street analysts remain divided.
- Morgan Stanley upgraded Lucid Group from “underweight” to “equal weight” and set a $3.00 price target, signaling a more neutral stance.
- TD Cowen, however, initiated coverage with a “hold” rating and a $2.30 target, reflecting cautious optimism.
- Cantor Fitzgerald echoed a similar sentiment, maintaining a “neutral” rating and a $3.00 target.
- In contrast, Redburn Atlantic took a bearish view, downgrading Lucid to “sell” and slashing its price target from $3.50 to $1.13—one of the most pessimistic outlooks on the stock.
- Benchmark maintained its “buy” rating with a $5.00 price target, betting on Lucid’s long-term growth potential.
Overall, two analysts rate LCID as a “sell”, nine recommend holding, and two are bullish with a “buy” rating. The stock currently holds an average rating of “Hold” with a consensus price target of $2.69, according to MarketBeat.com.
Financial Metrics and Performance
Lucid’s recent performance has been mixed:
- The stock is trading below its 50-day moving average of $2.66 and its 200-day moving average of $2.78.
- The company maintains a current ratio of 3.71 and a quick ratio of 3.26, indicating healthy short-term liquidity.
- However, Lucid carries a debt-to-equity ratio of 0.77 and a market capitalization of $7.31 billion.
- The company’s price-to-earnings (P/E) ratio stands at -1.80, highlighting ongoing losses, while its beta of 0.97 suggests volatility in line with the broader market.
Institutional Activity: Hedge Funds Show Mixed Interest
Institutional investors have recently increased their stakes in Lucid Group, demonstrating mixed confidence in the EV maker:
- Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund, boosted its holdings by 28.8% in Q4, now owning 1.77 billion shares worth approximately $5.35 billion.
- Vanguard Group Inc. increased its position by 31.1%, bringing its stake to 110.3 million shares valued at $333.2 million.
- Geode Capital Management LLC also expanded its holdings by 31.4%, reaching 20.2 million shares worth $61.2 million.
- Meanwhile, Renaissance Technologies LLC took a bullish stance, increasing its stake by 342.7% to 16.5 million shares, valued at $49.9 million.
- Two Sigma Investments LP made a notable move, acquiring 15.9 million shares, marking a 4,320.7% increase in its position, signaling strong bullish sentiment from the hedge fund.
Outlook: Lucid Faces Challenges but Holds Long-Term Potential
While Wall Street analysts remain divided, Lucid Group continues to attract significant institutional interest, led by Saudi Arabia’s PIF, indicating confidence in the company’s long-term prospects.
However, the EV maker faces near-term challenges, including pricing pressure, competition from Tesla, and the broader market’s cautious sentiment toward EV stocks. Lucid’s ability to expand production, control costs, and ramp up sales will be critical in determining whether it can defy Wall Street’s bearish outlook.
For long-term investors, LCID offers both potential upside from strategic backers and partnerships, but also comes with considerable risk given its current financial struggles and market volatility.
