Shares of the EV maker Lucid Motors closed 7.24% lower Monday, a drop the interim CEO Marc Winterhoff attributed to retail investors taking gains from last week’s surge.
Lucid’s shares initially surged nearly 60% to $3.69 following the announcement of a partnership with Uber and the privately held firm Nuro to deploy 20,000 Gravity Robotaxis starting in a major US city by late next year.
Speaking with Fox Business in the final hour of the market, Winterhoff was questioned about Lucid’s announcement to execute a 1 for 10 reverse stock split.
The executive had already downplayed delisting concerns last week and repeated on Monday that the reverse stock split was meant to attract more institutional investors and “reduce the amount of retail investors.”
“Yeah, this is something which may not be widely known, but — you know — several institutional investors, they actually have limits or thresholds you have to be over from a stock price that they can even invest in you,” the executive stated.
“And that’s one reason we want to open — you know — the investor base into areas, that then can invest in us and maybe reduce the amount of retail investors,” he added.
Lucid shares fell more than 7% on Monday but remain up nearly 23% since last Tuesday’s announcements. The stock initially jumped as much as 60% but has since given back much of those gains.
“I mean, you see today we are down —I actually didn’t look in the last 10 minutes, but I assume we’re still down — and that is because of retail investors, because most likely, you know, taking the profit of last week’s spike,” Winterhoff said.
“And we are looking for long-term investors,” he added while Lucid shares were trading about 7% lower on the day.
The interim CEO described the reverse stock split as a ‘technical exercise,’ saying it doesn’t change the company’s overall value.
‘That’s basically why we did this. It’s more like a technical exercise. I mean, the stock doesn’t get more or less worth through this,’ he said, referring to the market capitalization remaining unchanged.
“And yeah, but that’s exactly because we want to open our reach for new investor bases,” he concluded.
CNBC’s Mad Money host Jim Cramer questioned the impact of the deal during Monday’s broadcast, arguing that the investment lacked the scale or strategic substance to meaningfully change Lucid’s trajectory.
Lucid, which went public via a merger with Churchill Capital Corp IV in 2021, has seen its shares plunge about 95% from its post-SPAC peak.
The stock hit an all-time low of $1.93 last November, shortly after the company announced a $1.67 billion capital raise through a public offering.
