Written by Cláudio Afonso | LinkedIn | X
U.S. carmaker Lucid Motors stays “nowhere close to even generating a gross profit” with its cash burn rate “remaining troublesome,” CFRA analyst Garrett Nelson said in a new research note on Wednesday.
The analyst upgraded the stock’s rating from ‘Strong Sell’ to ‘Sell’ while reiterating a price target of $1.00. The EV maker reported its fourth-quarter earnings results in late February and announced, on the same day, that its CEO and CTO Peter Rawlinson had stepped down with immediate effect.
Nelson stated that the company “remains nowhere close to even generating a gross profit” citing the “full-year 2024 gross loss of over $90,000/vehicle” while its free cash flow “was negative $2.9 billion.”
Despite this year’s vehicle production guidance of 20,000 units — which would more than double the figures from 2024 — the firm sees the company’s cash burn rate “remaining troublesome.”
Lucid disclosed last week that it generated $598 million in revenue from North America in 2024, an increase of 15% from 2023 — while annual global deliveries jumped 71% to 10,241 vehicles.
“Furthermore, we think a new CEO may want to take the time to review LCID’s road map and make strategic changes, but we think LCID’s current situation requires urgency in the face of daunting fundamental headwinds and the recent bankruptcies of various EV competitors,” he wrote.
“While we remain bearish on the LCID story, the stock’s implied downside to our price target isn’t as material following its precipitous drop over the past couple of weeks.”
As reported earlier this week, the company reached a new sales record in the U.S. with 805 units sold in February, according to Motor Intelligence estimates. The figures include 750 Air sedans and 55 Gravity SUVs.
In Europe, Lucid has been struggling to increase its brand awareness and demand. As of February 28, the company sold only one vehicle in the Netherlands — where its European headquarers are located.
