Written by Cláudio Afonso | LinkedIn | X
BofA Securities analyst John Murphy reiterated a Neutral rating on Lucid Group shares in a research note released Thursday, setting a price target of $3.40.
With Lucid closing at $2.69 on Thursday, the target implies an upside potential of 26.4%.
Murphy highlighted Lucid as one of the most promising electric vehicle startups, stating, “We view the company as one of the most attractive among the universe of start-up EV automakers.”
The analyst pointed to Lucid’s progress and leadership as key strengths, adding, “We also believe Lucid has more pieces of the puzzle in place and in process than most of its peers, and it is steered by a management team with impressive experience.”
Lucid said Thursday it expects third-quarter revenue to range between $199 million and $200 million, slightly below the $200.6 million reported in the second quarter, despite having delivered an additional 387 vehicles between July and September.
However, despite its potential, Murphy cautioned that profitability remains a long-term challenge.
“That said, we now expect it could take until 2027+ for LCID to breakeven on an operating and cash flow basis and it would need to raise a substantial amount of capital over the next few years. Therefore, we reiterate our Neutral rating,” he wrote.
As of the time of writing, Lucid shares are trading 1.10% lower at $2.65 per share.
CFRA analyst Garrett Nelson also commented on Lucid’s public offering and third-quarter estimated results saying the decision to do a 262.4 million shares offering was “a major red flag” given “the precipitous decline for the stock over the past several quarters”.
Nelson reiterated the firm’s Sell rating and $2.00 price target on the shares.
Ayar Third Investment Company, an affiliate of Lucid’s biggest shareholder PIF (Saudi Arabia’s Public Investment Fund) will purchase 374,717,927 shares of common stock from Lucid in a private placement concurrent with the public offering.
Lucid is preparing to start mass production of its second model Gravity late this year. A third model is also in the pipeline for late 2026 and a price target at about $48,000.
The model will target the Tesla Model Y, the world’s best-selling vehicle which will have an upgraded version early next year.
Written by Cláudio Afonso | LinkedIn | X
