Cantor Fitzgerald analyst Andres Sheppard has reaffirmed a ‘Neutral’ rating on Lucid Group stock (NASDAQ: LCID), citing the company’s strengthening supply chain as a key factor.
Sheppard maintained a 12-month price target of $3, implying nearly 35% upside from Lucid’s current trading price of $2.23.
In a June 16 investor note, the analyst expressed cautious optimism about Lucid’s recently signed multi-year supply agreement with Graphite One for U.S.-sourced natural graphite.
The deal is a strategic move that could enhance the EV maker’s domestic supply chain for critical battery materials.
Graphite production under the agreement is expected to begin in 2028, offering long-term support for Lucid’s vertical integration goals. Sheppard noted that future Lucid models would likely use natural, synthetic graphite from this partnership.
Despite the supply chain progress, the analyst maintained a wait-and-see approach, pointing to the extended timeline and the fact that broader business fundamentals remain unchanged. While the development is meaningful, it may take years before the benefits fully materialize.
Cantor Fitzgerald believes these long lead times and current market dynamics warrant a neutral stance on the stock for now.
Lucid stock’s lingering risks
Despite the optimistic long-term outlook, Lucid is navigating a challenging environment that still weighs on investor sentiment.
For instance, the unexpected departure of longtime CEO Peter Rawlinson sparked concerns on Wall Street, with some analysts warning it could disrupt innovation, dampen demand, and complicate future fundraising efforts.
However, the launch of the Gravity SUV marks a significant milestone for the company. The new model expands Lucid’s lineup beyond the Air sedan and positions it in the fast-growing U.S. SUV market with expected stronger sales in 2025 and 2026, but pricing remains a major headwind.
In this case, Lucid vehicles range from $70,000 to $249,000, putting even base models out of reach for many buyers. While the Gravity SUV adds variety, the high price points could continue to limit the company’s addressable market and constrain demand.
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