Luxury electric vehicle (EV) manufacturer Lucid Motors (NASDAQ: LCID) continues to face challenges, with the company’s stock high volatility over the past year as it aims to compete with players such as Tesla (NASDAQ: TSLA).
This bumpy ride has extended into 2025, with LCID remaining below key resistance levels at $5 and $10. At the time of reporting, the equity was valued at $2.93, plunging almost 5% since the last market close. Year to date, Lucid has declined over 3%.
Considering the long-term resistance level of $10, the stock would need to rally by a massive 240% from the current valuation—an ambitious target given the recent dynamics facing the EV maker.
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Several fundamentals will likely influence LCID’s price, presenting both opportunities and challenges in its possible trajectory toward $10.
Lucid stock’s fundamentals
The inauguration of Donald Trump has added several headwinds to Lucid’s outlook, with his administration planning to revoke the EV mandate and remove subsidies. Such moves could hinder the firm’s growth.
Without federal incentives, consumer demand for EVs may slow, creating challenges for smaller players like Lucid, which is still scaling operations.
The regulatory uncertainty complicates Lucid’s treacherous path, dominated by financial strain from high cash burn rates and unmet production goals. Though technologically impressive, the firm’s luxury vehicles struggle with demand due to steep pricing, limiting market reach against competitors like Tesla.
However, the company presents several growth opportunities, with its main strength embedded in its appealing product line, including the Lucid Air sedan.
Lucid’s recent production growth highlights its potential. On January 6, the firm reported its Q4 results, producing 3,386 vehicles and delivering 3,099. For 2024, it produced 9,029 vehicles and delivered 10,241, surpassing its annual guidance for the first time since 2022.
At the same time, Lucid’s strong financial backing from Saudi Arabia’s Public Investment Fund provides a safety net. This funding could help the company endure near-term challenges and maintain its pursuit of long-term growth in the evolving EV landscape.
LCID stock market sentiment
Market sentiment, however, remains pessimistic for Lucid. A consensus of eight Wall Street analysts at TipRanks projects the equity is likely to trade at an average price of $3.04 over the next 12 months.
Most analysts, six, maintain a ‘Hold’ rating on the stock, while only one recommends a ‘Buy.’ Interestingly, even the bullish analysts in this group do not foresee Lucid reaching $5, having set a high target of $4 for the next year.
Regarding Lucid’s technical outlook, stock trading analyst Shaun Trades observed in a January 20 X post that Lucid’s long-term outlook appears optimistic. He noted that LCID has broken out of a long-term downtrend, signaling potential bullish momentum.
After struggling below a descending trendline for months, the stock has pushed above key resistance levels and could rally toward the $4.20 and $5.20 levels in the next five weeks.
However, this movement hinges on Lucid reclaiming the $3 support and sustaining its price above this level. A sustained drop below the mark could invalidate any chances of upward momentum.
While Lucid Motors boasts innovative products and strong backing from Saudi Arabia’s Public Investment Fund, reaching $10 in 2025 remains a steep challenge. With market sentiment and analyst targets remaining cautious, Lucid must overcome the current financial and operational hurdles to achieve this ambitious milestone.
Featured image via Shutterstock
