Despite a significant advantage when it comes to vehicle range, luxury EV maker Lucid has struggled since debuting on the stock market in mid-2021. Ever since late 2023, Lucid stock (NASDAQ: LCID) has failed to climb above a price of $5.
Since beginning operations, the company has had a mixed track record when it comes to meeting vehicle production and delivery estimates. In addition, although the automaker has a seemingly endless spring of funding from Saudi Arabia’s Public Investment Fund, that very relationship has been a constant source of worries concerning share dilution.
The beginning of 2025 did see the appearance of several silver linings, however. On January 6, the company’s Q4 production and delivery results beat estimates — marking the first time that this has happened since 2022. By February 18, LCID shares had rocketed to a 5-month high of $3.45.
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February 25 was a particularly volatile day for Lucid stock. While it opened at $2.86, it closed some 8.58% lower, at a price of $2.61. In the after-hours trading session, Lucid shares skyrocketed by 10.71% and reached prices as high as $2.86.
By press time on February 26, prices had receded down to $2.45 — marking a roughly 14.3% drop from the after-hours trading session a day prior, and bringing year-to-date (YTD) losses up to 19.04%.
Let’s take a closer look at exactly what is causing these hectic swings in the price of Lucid stock.
Lucid stock price drops on CEO departure, analyst downgrade
After market close on February 25, the luxury carmaker held its Q4 and FY 2024 earnings call. Both earnings per share (EPS) and revenues came in above analyst estimates.
The company is still far from profitable — but that didn’t exactly come as a surprise to anyone. On the other hand, the sudden departure of Peter Rawlinson, who had held the position of Chief Executive Officer (CEO) for close to 6 years, was indeed a surprise.
Rawlinson will stay on in an advisory capacity, although one Wall Street analyst sees this as a significant loss for the company.
In a note shared with investors following the quarterly report, Bank of America researcher John Murphy slashed his price target on Lucid stock from $3 to $1, citing concerns regarding whether or not the company’s ambitious plans to scale production and deliveries, as well as release 3 new models by late 2026 are feasible.
This isn’t the first instance of a high-level executive at the company suddenly leaving — in December, the same occurred with Lucid’s former Chief Financial Officer (CFO), Sherry House. While abrupt departures of high-ranking personnel tend to stoke investor uncertainty, it is also judicious to remember that not all of these changes wind up having a negative effect on operations.
Featured image via Shutterstock
