Written by Cláudio Afonso | LinkedIn | X
Last week, Lucid Motors announced a 262 million stock offering to raise about $1.75 billion. Since the announcement, the stock has fallen about 24%, extending its year-to-date losses to 41%, as Wall Street analysts expressed surprise at the move.
The drop comes one day after CEO Peter Rawlinson said the upcoming Gravity SUV will only start high-volume production in 2026. The timeline indicates that, despite the start of production scheduled for late this year, the company will need one year to ramp up the output.
Rawlinson emphasized earlier this week that the capital raise “should have come as zero surprise to anyone,” adding that the new funds will ensure the company’s financial stability through 2026.
That’s when Lucid plans to unveil its third model — a mid-size EV with a starting price of “about $48,000.”
Commenting on the fundraising, Morgan Stanley analyst Adam Jonas said it “was slightly larger and earlier than we had expected.”
Also, RBC Capital Markets analyst Tom Narayan expressed last week surprise at the decision adding the firm expected a decline in the stock price.
“We suspect that investors will wonder why LCID is raising more capital just after it secured the PIF capital in August, and at currently depressed share price levels. We expect Lucid shares to trade sharply lower as a result,” he noted.
Shortly after the announcement last week, CFRA analyst Garrett Nelson released a research note reiterating the firm’s Sell rating and $2.00 price target on the shares.
The analyst said the firm sees the decision to do a 262.4 million shares offering as “a major red flag” given “the precipitous decline for the stock over the past several quarters”.
As of the time of writing, Lucid shares are falling 5% and are trading at $2.47, about 8% higher than their all-time low of $2.29 reached last April.
Lucid said last week 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.
Written by Cláudio Afonso | LinkedIn | X
