Lucid (NASDAQ:LCID) announced production and delivery numbers for the first quarter. It will release financial results on May 8.
The company, which is based in Arizona but backed by the Saudi government, produced 2,314 vehicles in Arizona during the quarter and delivered 1,406.
Investors turned thumbs down on the numbers. LCID stock fell 7.5% overnight and was due to open this morning, April 14, at about $7.70 per share, a market capitalization of about $14 billion.
Is Anyone Listening?
Lucid was one of several luxury electric vehicle (EV) stocks that came public in the last decade and whose value jumped during the 2021 bull market, only to plunge with 2022’s bear market.
Lucid’s value was tied to Saudi investment and orders, much like that of Rivian (NASDAQ:RIVN) was tied to the investment and orders of Amazon (NASDAQ:AMZN). Both stocks have fallen over 60% in the last year. The only hope for Lucid this year came in January when rumors swirled that Saudi Arabia’s public investment fund might buy it.
Since then, analysts have soured on Lucid. The bearish sentiment was summed up by our own Louis Navillier, who wrote last month that bullish sentiment is based on hope. Lucid produced only 3,493 vehicles for all of 2022. “Hard facts don’t justify an optimistic call,” he concluded.
Other InvestorPlace analysts and contributors agree. Thomas Niel is worried investors may see their stake diluted by the need for more capital. David Moadel does not expect a recent restructuring, which included laying off 20% of Lucid’s workers, to lift LCID stock. Only half of the eight analysts following Lucid at TipRanks recommend buying it.
New EPA rules requiring that half of U.S. cars be electric by 2032 won’t save Lucid, either. And Lucid’s cars are too expensive to qualify for the $7,500 EV tax credits in the Inflation Reduction Act.
LCID Stock: What Happens Next?
Lucid was built to make luxury EVs. But the Biden administration, and the market, now want EVs most consumers can buy. If Saudi drivers don’t take to Lucid in a big way, it’s hard to see how the company succeeds.
On the date of publication, Dana Blankenhorn held a long position in AMZN. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
