The average target price of LCID is 2.5 and suggests 11% downside potential. Usually, this means a SELL recommendation among investment firms, or a recommendation to decrease one's position in this instrument in the next 12 months. The most optimistic analyst has a target price of 5.0. This translates into 81% upside potential in the best case. On the other hand, the most pessimistic analyst has a target price of 1.0. This is equivalent to 64% downside potential in the worst case. 

Lucid Group, Inc. a technology and automotive company, develops electric vehicle (EV) technologies. The company designs, engineers, and builds electric vehicles, EV powertrains, and battery systems. As of December 31, 2021, it operates twenty retail studios in the United States. Lucid Group, Inc. was founded in 2007 and is headquartered in Newark, California.

Lucid Group, Inc.

Consumer Cyclical

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

LCID reported revenue of USD 870mn in the last 12 months, up 8% from FY24. The dynamics of cash flow, as measure by free cash flow (FCF), were rather similar. EPS fell 5% from FY24 to USD -1.21. Market expects EPS to reach USD -1.17 in FY25.

The stock's performance has been mixed in the past six months, with growth following a decline. There is no clear price trend compared to its global peers from the same sector and industry (as shown above). The stock has outperformed this peer group by 45ppts over past six months and grown 16ppts faster in the past month. This is largely true for peers from the same country and sector. With respect to the stock's valuation against its peers, its overall price performance is 'fair'.

The company has reported very poor EBITDA margins compared to its global peers in recent years. EBITDA margin amounted to -284.1% in the last 12 months, up from -429.5% in FY23. 

Historically, LCID has reported very poor net margins compared to its global peers. Specifically, in the last 12 months, this metric equalled -275.7%, a growth from -475.1% in FY23. 

Another important profitability metric, return on assets (RoA), amounted to -27.1% in the last 12 months, an increase from -34.5% in FY23. The market analysts predict that RoA will be -28.5% in FY24, again weaker than its peers. 

In the last 12 months, the return on capital employed (RoCE) grew to -31.2%, below the peers. The consensus estimate for FY24 for RoCE is -32.1%, again behind the peers. 

Lucid Group, Inc. reported a return on equity (RoE) of -59.7% in the last 12 months, up from -61.5% in FY23. The market consensus projects an RoE of -50.0% in FY24, again behind its peers. 

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -4.9 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

LCID boasts very high trading liquidity. The average private investor can sell his common position in the stock immediately. Liquidity is usually very stable and remains extremely favourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to bleak profitability, negligible return on capital, inadequate interest coverage, and poor cash flow generation. We note resilient historical revenue growth and low margin volatility, among the positive credit factors. 

In highly turbulent market conditions, LCID is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, LCID is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

Considering past and projected metrics, the stock is distinctly 'expensive' compared to its peers. 

Lucid Group, Inc.

$ 2.96

2

Lucid Group, Inc.

$ 2.96

2

Risk factor

Profitability factor

Risk / Profitability

About

About

Risk factor

Profitability factor

$ 2.96

About

About

Lucid Group, Inc.

$ 2.96

2

Lucid Group, Inc.

$ 2.96

2

Risk factor

Profitability factor

Risk / Profitability

About

About

Risk factor

Profitability factor

$ 2.96

About

About

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