Get 40% Off
🚀 AI-picked stocks soar in May. PRFT is +55%—in just 16 days! Don’t miss June’s top picks.Unlock full list

Citi updates its outlook for Lucid stock. Here's where it expects LCID shares to trade

Published 04/22/2024, 03:48 PM
Updated 04/22/2024, 03:50 PM
© Reuters.  Citi updates its outlook for Lucid stock. Here's where it expects LCID shares to trade
LCID
-

Citi Research analysts said Friday they are resuming coverage of Lucid (NASDAQ:LCID) with a Neutral/High Risk rating and a price target of $2.90, implying over 20% upside from the current levels.

“We see a balanced risk/reward when weighing Lucid’s strong EV tech position & adequate NT liquidity against past demand/branding challenges and the reliance on a successful Gravity ramp later this year,” analysts wrote.

After reviewing the Gravity model, analysts said they felt encouraged by the vehicle’s prospects for success.

Nonetheless, they acknowledge a significant execution risk in launching Gravity on time, adding that launching with the most affordable trims could help drive volume and build commercial momentum, even if it impacts initial contribution margins negatively.

“Over the near-term, we expect the shares to trade range-bound until the Gravity launch comes into clearer view,” analysts said.

To reflect the carmaker’s 2024 guidance and Q1 actuals, Citi now estimates that Lucid will deliver around 9,100 vehicles in 2024. It is also projecting an adjusted EBITDA loss of $2.0 billion for the year and expects the company to reach breakeven by 2027.

“We do model 2025E losses widening YoY on the initial Gravity launch and higher R&D for the premium SUV due out late 2026,” analysts added.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.