LCID share price prediction • Bear and bullish case • Benzinga

Lucid Motors (NASDAQ: LCID) is a small Californian manufacturer looking to find a place in the electric vehicle sector. Despite having less than 2,000 full-time employees and no cars currently on the road, the company has a market capitalization exceeding $ 40 billion and is among the most prominent electric vehicle startups in Silicon Valley. .

After successfully raising funds for a number of years, Lucid Motors went public in 2021 as Lucid Group and trades under the ticker symbol LCID. After starting as a battery maker, the company eventually moved into fully electric vehicle production and announced that its first entry, the Lucid Air, will be delivered in the fourth quarter of this year.

Where does LCID go from here? Regulatory tailwinds are certainly a boost and the company could be successful with its first vehicle, but the EV space is crowded and it will be difficult to pick winners and losers.

LCID market position

Lucid Motors has been around since 2007, but the company has only recently entered the public sphere. The company went public earlier this year thanks to (what else) a merger with a Special Purpose Acquisition Company (SPAC) called Churchill Capital Corp, which made headlines in early 2021 after the Same stock traders have offered the stock (then CCIV) up to over 400% of its original price of $ 10. By the time the company announced its merger with Lucid, shares began to drop and the stock became a social media outcast.

Today, memories of Churchill Capital’s madness have faded and the shares are trading as LCID on the NASDAQ stock exchange. The company currently has a market cap north of $ 40 billion, which may not sound like big compared to industry stalwarts like Tesla Motors (NASDAQ: TSLA), but that’s a huge number compared to some. smaller competitors like Fisker Inc. (NYSE: FSKR), ChargePoint Holdings (NYSE: CHPT) and Lion Electric (NYSE: LEV), which total less than $ 10 billion.

Market cap is a better barometer for future growth prospects than the stock price because it includes more data on the value of the company. Stock prices can be high or low, but that doesn’t tell us anything about the number of shares outstanding. Market capitalization multiplies the stock price by the number of shares outstanding to form a more accurate picture of a company’s value and growth potential.

CitiGroup analysts’ bullish case for LCID stocks

CitiGroup launched the stock hedging in early September, with analyst Itay Michaeli giving the stock a PURCHASE rating and a price target of $ 28. In his analysis, Michaeli recommends the stock because he sees many parallels with the behemoth EV Tesla: technical skills and credentials, history in space, brand recognition and the planned launch of the Lucid Air vehicle. Additionally, the company has other potentially profitable wings in battery production that could fuel growth over the next several years.

Morgan Stanley analyst’s argument for LCID action

However, not everyone is excited about the prospects for LCID stocks. Morgan Stanley analyst Adam Jonas is underweight the stock and a price target of $ 12, which is a 50% discount from current levels. Jonas is bearish on the stock as his market cap has exceeded a rational valuation and competition in EVs could leave Lucid behind.

LCID share price history

LCID’s chart shows both its time as SPAC Churchill Capital Corp and its current iteration as the Lucid Group. After climbing nearly $ 65 around the start of March, the stock stabilized after the deal was announced with Lucid Motors and the shares were rebranded and started trading as LCID end of July.

The action has mostly been limited since its trip to the moon in March, going from the $ 16 range to the $ 28 range without ever breaking out. However, after getting almost no volume for most of the spring and summer, activity has picked up since early September, but the volume spike has yet to create a corresponding spike in stock prices. It may just coincide with the imminent delivery of the first batch of Lucid Air vehicles, but an increase in volume is rarely a bad sign.

Where to buy LCID shares

Want to add Lucid Group shares to your portfolio? LCID may be a newcomer to the US capital markets, but with over 1.6 billion shares outstanding, you shouldn’t have a hard time locating it at a reputable brokerage firm. Here are some of Benzinga’s favorites for investors of all skill levels.

How long will it take for the LCID inventory to reach $ 65?

Churchill Capital Corp, SPAC’s predecessor to LCID, went from $ 10 to $ 65 in a short period of time last winter and many traders are looking for the stock to return to that level as LCID. Of course, these investors could wait a while. LCID already has a market capitalization that dwarfs the majority of its peers.

And while it launches its first vehicle on the market, the field of electric vehicles continues to be crowded. To hit $ 65, the stock should gain over 100% from here, so investors should temper their short-term expectations.

Market capitalization could hamper future returns

Lucid Motors has a reputation in the industry for its successful battery products, but it remains to be seen if their vehicles will make an impact. With a market cap of over $ 40 billion, the company may have gotten ahead of the curve due to the market euphoria. Manufacturers of electric vehicles have been very active, with similar stocks such as LEV and NIO registering strong increases in the near term.

But if we view LCID as a long-term investment, it’s important to consider market capitalization relative to actual company size and sales forecast. Lucid Motors certainly has potential, but it can be difficult for the title to reach its previous heights when he was a darling of the SPAC meme. To get back to this level, LCID will likely have to go the old way, becoming profitable.

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