After enduring consecutive days of losses, the stock price of Lucid Motors (NASDAQ: LCID), the electric vehicle (EV) startup, is now showing signs of recovery, capturing increased investor interest.
Over the past five days, the stock has experienced a noteworthy rally of almost 9%, rebounding from an all-time low of approximately $2.5. Notably, the EV stock has surged by over 15% since hitting the record low, reaching $3.11 by press date. The market’s focus has shifted to LCID’s ability to sustain its price above the crucial $3 support zone.
This resurgence aligns with the broader market trend, which has recently been bullish. Additionally, the company is capitalizing on developments related to Tesla (NASDAQ: TSLA), particularly after the Elon Musk-led company announced plans to recall over 4,300 vehicles in Australia due to software issues impacting the steering wheel.
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It is worth noting that part of Lucid’s previous stock price decline was also attributed to its struggle to keep up with competitors like Tesla. LCID’s prospects were dampened as it sought to compete with Tesla’s aggressive price cuts.
Can Lucid sustain short-term gains?
Having demonstrated the ability to generate short-term gains, attention is now focused on Lucid’s capacity to sustain this momentum. To achieve this, the company must show commitment to addressing recent challenges affecting its performance. Crucially, Lucid needs to accelerate production and minimize losses.
The forthcoming fourth-quarter results call, scheduled for February, will be a key indicator of the company’s ability to tackle these challenges. While the last quarter of 2023 saw Lucid produce 2,391 vehicles and deliver 1,734, investor interest will be keenly directed towards the company’s financial health and management’s guidance for business enhancement.
When assessing the guidance provided by Lucid, the company faces the challenge of persuading investors regarding its strategies to ramp up deliveries and curtail losses.
At the same time, the company’s potential appears promising, given its status as a startup with ample room for growth. Lucid’s growth trajectory is further underscored by its forthcoming product line expansion, featuring models like the Lucid Gravity SUV set for release in 2025. Realizing gains from its deal with the Saudi government adds another layer of anticipated growth.
Wall Street LCID analysis
Furthermore, nine Wall Street analysts from TipRanks have offered predictions for LCID’s future price performance. Their collective forecast has set an average price of $5.09, with a high projection of $7 and a low projection of $1 over the next 12 months. This average price target signifies a 65% change from the stock’s recent price of $2.65.
However, investors in LCID should brace for short-term volatility influenced by the broader market trajectory. Market dynamics will likely sway the stock’s performance as the company navigates its growth plans and seeks to align with investor expectations.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
