In what has been a lackluster year for Lucid (NASDAQ: LCID) stock in terms of performance, the EV manufacturer has reported falling sales of its vehicles quarter after quarter, managing to sell just 6,000 units in 2023.
This disappointing sales performance has eroded investor confidence, contributing to a marked decline in LCID’s stock value. Over the last year, the stock plummeted by -72%, reflecting the market’s growing skepticism about the company’s profitability and growth trajectory.
Lucid’s stock saw an unexpected rally, gaining over 20% in value over the past five trading sessions. This surge is believed to be partly due to the company’s newly announced deal with Ma’aden Rolling, a leading Saudi Arabian aluminum supplier, to enhance its manufacturing capabilities. Additionally, the stock’s high short interest rate of 29.32% suggests a speculative dynamic in the market, potentially contributing to its recent volatility.
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LCID chart analysis
Lucid faces negative short- and long-term trends, with 95% of stocks outperforming it in the past year. Trading near the lower end of its 52-week range is a concerning sign, especially when compared to the S&P 500 reaching new highs.
At the time of press, LCID stock was trading at $3.31, showcasing a -3.22% decrease since the markets closed on February 2. Since the beginning of this year, this stock has lost -20.24% of its value.
Over the last month, LCID has traded between $2.54 and $3.95, currently positioned in the middle, possibly facing resistance ahead.
Increased volume is positive, and LCID maintains a healthy average daily trading volume of 42,784,400 shares. In the automobile industry, it performs on average, surpassing 42% of its peers.
Wall Street projection for LCID stock
Investors might wonder whether Lucid can increase its value with the ongoing development. Wall Street thinks so, as the 8 analysts from different institutions, such as RBC Capital, R.F. Lafferty, and Stifel, forecasting an upside of 55.29% for this stock in the next 12 months could drive the stock value to $5.14.
However, optimism remains in check, as 7 advised a ‘hold,’ while one recommended a ‘sell,’ and none opted towards ‘buy.’
Could Wall Street be onto something?
Wall Street seems to have recognized Saudi Arabia as a crucial support for Lucid, with the Saudi sovereign wealth fund holding over 60% of the company’s common stock after a substantial $1.8 billion investment last year.
Lucid has established a manufacturing facility in Saudi Arabia, and the government has committed to purchasing up to 100,000 Lucid vehicles over the next decade.
This strategic alliance with Saudi Arabia could prove vital for Lucid’s stability, especially as it endeavors to launch its upcoming electric vehicle, the Gravity SUV, later this year.
In the most recent update to their cooperation, the Saudi Arabian police force unveiled its newest addition to the fleet, a Lucid Air model configured to hold a police drone.
In what seems to be the ‘make it or break it scenario’ for this EV company, the Arabian investment looks like a lifeline that could help it find its footing and potentially establish itself as a profitable company. Will it be so or not? Only time can tell.
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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.
