Lucid Motors (NASDAQ: LCID) hasn’t exactly been a stock market performer in 2024, and its situation worsened after the closing bell on October 16, 2024.
The downturn – which was 14.94% at press time on October 17 and saw LCID plummet to $2.79 – was triggered by a Wednesday announcement that the electric vehicle (EV) maker is conducting a new offering of just over 262 million shares.
Additionally, Lucid revealed that the underwriter – Bank of America (NYSE: BAC) securities – will simultaneously be granted the option to purchase more than 39 million shares within 30 days.
Picks for you
Investors were not keen on the latest stock dilution – as evidenced by the extended session selling pressure – despite the Saudi Arabian Public Investment Fund (PIF) pledging to purchase nearly 375 million shares to maintain its ownership stake.
Lucid intends to use the money raised through the offering ‘for general corporate purposes.’
Lucid stock fails to sustain its post-deliveries rally
The offering was a nasty surprise following Lucid’s October 7 rally, which followed an exceptionally strong third-quarter (Q3) production and deliveries report.
Specifically, the beleaguered EV maker announced at the time it had shipped 2,781 vehicles, significantly beating the forecasts of 2,242 and the Q2 figure of 2,394.
Still, the rally’s lack of longevity can also be explained by some of the figures in the report itself. While Lucid beat analyst expectations in terms of deliveries, it produced 1,805 vehicles – 300 fewer than in the previous quarter and 400 fewer than expected.
Why is Lucid stock down in 2024 despite experiencing multiple strong rallies
Furthermore, the fragility of every Lucid stock rally in 2024 can also be attributed to the long-term disappointment in the company once heralded as a ‘Tesla (NASDAQ: TSLA)-killer.’
If the EV maker’s initial public offering (IPO) era promises are taken into account, the firm missed its delivery target for the first half of 2024 by some 90% – it had shipped 4,361 vehicles compared to the originally projected 90,000.
Despite such failure to deliver, there remains significant hope that Lucid will eventually find its footing. This is exemplified by the stock’s continued ability to generate rallies, even in the wake of long-term fragility, and its continued efforts to generate excitement for its products through various showcases and partnerships.
The most recent was introducing the Lucid Air model to Four Seasons, originally announced in mid-October.
Still, it would likely be fair to say that Lucid owes much of its remaining investor confidence to its ownership and backing by the vast wealth of the PIF.
Lucid stock price chart
Finally, no matter the long-term hopes, LCID stock’s performance in 2024 has been anything but promising. In the year-to-date (YTD) chart, Lucid shares are 20.96% in the red even without accounting for the extended session bloodbath, and the EV maker’s latest closing price stood at $3.28.
Furthermore, LCID’s performance in the last 30 days leaves much to be desired despite the post-delivery rally, as the stock declined 13.23% within the time frame. The crowning jewel of Lucid’s woes, despite the 2024 drop, remains its 66.84% fall from the IPO price.
