Reality is starting to set in as investors start to question the valuation and scalability of Lucid. Currently trading with a market capitalization of $73 billion, Lucid’s revenue during the third quarter was a sparse $232,000. Additionally, Lucid reported a loss per share for Q3 of 43 cents. Investors should realize that the path to profitability is clearly way down the road.
On the bright side, Lucid announced that it had surpassed 17,000 reservations for its Air model, up from 13,000 earlier in Q3. The company also has plans to produce at least 20,000 vehicles during 2022 and is currently expanding its AMP-1 manufacturing facility to increase production output. Additionally, the Lucid Air won the 2022 MotorTrend Car of the Year aware, which is sure to attract potential consumers — and media coverage.
Is the momentum surrounding EV names slowly running out of steam? Let’s take a look at what experts are saying about LCID stock.
How Do Experts Feel About LCID Stock?
- Bank of America has a $60 price target, a Wall Street high. Analyst John Murphy believes Lucid could be the “next Tesla or Ferrari.” The $60 price target was calculated based on a 8.5x enterprise value-sales multiple using sales estimates from 2025.
- Citi has a $57 price target. Analyst Itay Michaeli expressed confidence in Lucid’s Q3 results and 2022 production target. Furthermore, he believes that Lucid’s advanced technology is gaining brand and commercial popularity.
- Morgan Stanley has a $16 price target. Analyst Adam Jonas reiterated his fears about Lucid being able to scale down the road, as well as current supply chain disruption issues. Jonas also stated that Lucid will likely miss its internal 2030 production targets as well.
- Finally, Lucid has an average price target of $33 among 3 firms covering the stock.
Lucid is currently trading near $44. It seems the analysts are split on either side of the spectrum, with Bank of America and Citi having high upside targets, while Morgan Stanley is more skeptical with its lower target. Only time will tell which side of analysts is right.
For now, Lucid remains a highly speculative and unprofitable play with a market capitalization based on future cash flows.
On the date of publication, Eddie Pan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.