In 2023, Lucid (NASDAQ: LCID) faced a tumultuous ride, grappling with challenges ranging from dwindling demand and missed delivery targets to the dropout of the Nasdaq index and the sudden exit of its CFO.
As the new year unfolds, investors are left pondering if 2024 holds the promise of a turnaround for the luxury electric vehicle (EV) maker.
Today, on January 5, we delve into what the next 12 months might have in store for LCID, examining the prospects for a potential fresh start.
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Why It’s Very Hard to Justify Buying LCID Right Now
The start of the new year conveys an impression of a clean slate, and with easing macroeconomic conditions and the upcoming dovish pivot by the Federal Reserve, there is a fair amount of optimism in the market.
Unfortunately, some companies are simply flooded with individual, fundamental challenges, and Lucid is one of them. Compared to previous years when investors were much more speculative, the EV market is now notably less forgiving toward unprofitable, underperforming companies.
The automaker announced a significant layoff in 2023, reducing its workforce by 18% in March. In turn, the company also slashed its full-year production outlook due to sluggish demand and suffered an abrupt departure of its chief financial officer (CFO), Sherry House.
To make things even worse, the stock also got thrown out of the Nasdaq 100 index and witnessed multiple analyst downgrades due to poor interest in its pricey vehicles.
Last month, Robert Schein, Chief Investment Officer at Blanke Schein Wealth Management, also advised investors to steer clear of LCID, citing overall headwinds in the EV industry, Lucid’s poor financials, and a high cash-burn rate.
LCID stock price analysis
At press time on January 5, shares of Lucid were standing at $3.89, down 1.77% in the past 24 hours.
The stock fell around 10% in the past 5 sessions, and more than 37% in the last year.
At this level, the stock is sitting approximately 7% above its all-time low of $3.62 reached on November 10.
One of the few positive developments the company experienced recently is the introduction of its long-awaited Gravity SUV. Based on the same platform as the Lucid Air sedan, Gravity is the automaker’s first foray into the incredibly competitive SUV market.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
