It doesn’t seem that long ago that investors and market pundits were saying Lucid Group (NASDAQ:LCID) was going to eat Tesla’s (NASDAQ:TSLA) lunch. That’s in sharp contrast to where sentiment for LCID stock stands today.

That is, instead of believing that this electric vehicle (EV) upstart is a “Tesla killer” in the making, the market is concerned it’s in fact more at risk of failure than not just Tesla,  but other early stage EV companies as well. So, with this big change in sentiment, should you stay away? Not necessarily.

Much like how the market possibly became overly bullish about this stock last year, the market could be overly bearish on it this year. It’s still a formidable EV contender, continuing to make progress scaling up its operations. If you’re looking to make a long-term wager on this vehicle electrification play, this dynamic may work in your favor.

LCID Stock Went From ‘Hot’ to ‘Not’

Plenty of high-fliers have become “former hot stocks” in the past year, but the sentiment shift with Lucid may be one of the most dramatic.

As you may recall, just the mere mention of this former special purpose acquisition company (SPAC) taking the-then privately-held EV maker public was enough to send LCID stock (at the time known as CCIV stock) up 6x from its debut price. This was mostly due to the bubbles at the time with EV stocks, SPAC stocks, and in particular, EV SPAC stocks.

Even as it pulled back following the deal closing, shares remained at elevated prices. Investors were very confident this firm, with its Lucid Air line of luxury EVs, could within a few years go from producing zero cars, to producing 250,000 vehicles annually.

Yet between supply chain setbacks and other hiccups, the company has had to walk back production targets. This, the looming threat of a recession, plus the impact of higher interest rates on stock valuations, has in turn played a big role in changing sentiment for the stock from “hot” to “not.” There is, however, a silver lining. Buying now, when it’s out-of-favor, could pay off down the road.

Still a Contender, Still Making Progress

The negatives may be what’s top of mind with LCID stock today, but it’s important to note that there are many positives still on the table. As I mentioned last month, the company remains on a strong financial footing. It has $5.4 billion in cash on hand.

One of its largest investors (the government of Saudi Arabia) has committed to a large vehicle order. This Saudi vehicle order is on top of the 30,000 reservations Lucid has received to-date. While challenges remain, it’s still focused on making progress ramping up production. It’s also made progress in other areas.

For instance, with the launch of its vehicle financing arm, Lucid Financial Services. Little-by-little, step-by-step, the EV maker is putting in the work to become a major brand in the space. So, what’s the upside potential if all of its efforts pay off down the road?

A return to past price levels is not out of the question. If it becomes clear that growth could continue, even in the event it reaches the 250,000 annual deliveries mark? Lucid shares could zoom even higher. This makes today’s prices seem favorable, when you weigh upside potential against downside risk.

The Verdict on LCID Stock

Lucid stock earns an “B” rating in my Portfolio Grader. While leaning towards positive on it, admittedly it will take time for the market’s overall sentiment to swing back.

It may not be until external uncertainties are fully absorbed by the market. It may not be until the headwinds affecting auto production clear up. Yet no matter what exactly puts shares into recovery mode, you may want to consider it now, ahead of such an event occurring.

At around $18 per share, it may not be “cheap” when using traditional valuation metrics. Compared to its long-term growth potential, however? It may be more than reasonable. In time, macro issues will dissipate. Along with this, this EV maker will make more progress getting towards billions in annual sales.

As both external and company-specific issues improve, LCID stock could steadily move back to higher prices.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.