Luxury electric vehicle manufacturer Lucid Group (LCID) is scheduled to release its second-quarter earnings results on August 5. The company’s stock has seen a 15% increase over the past month, although it remains down approximately 20% year-to-date. This downturn can be attributed to disappointing Q2 delivery figures and weakening demand, as consumers increasingly opt for less expensive hybrid and gas-powered vehicles. The competitive landscape in the electric vehicle sector is also intensifying, contributing to the challenging market conditions.
Analysts anticipate a Q2 loss of $0.21 per share, which represents an improvement from the $0.34 loss reported in the same quarter last year. On a more positive note, revenue is projected to grow by 30% year-over-year, reaching $261.3 million. Despite this anticipated growth, Lucid has missed earnings estimates in five of the last nine quarters, highlighting the ongoing difficulties the EV market is facing.
A notable development occurred on July 22, when Lucid announced that its Air sedan models would gain access to Tesla’s Supercharger network starting July 31. This news was positively received by investors, resulting in an approximately 11% jump in the stock price. Additionally, just days prior, Lucid formed a significant partnership with Uber, which will see the deployment of over 20,000 vehicles equipped with Nuro’s self-driving technology over the next six years, with Uber investing $300 million in Lucid through a private placement.
Analysts’ perceptions of LCID remain mixed. Cantor Fitzgerald analyst Andres Sheppard maintained a Neutral rating and a $3 price target, emphasizing caution despite the promising partnership. Conversely, Benchmark analyst Mickey Legg adopted a more optimistic stance, retaining a Buy rating and increasing the price target from $5 to $7. Legg views the Uber partnership as a significant advantage, providing fresh capital and advancing Lucid’s entry into the autonomous mobility space.
Options traders are forecasting considerable movement following the earnings report, with an expectation of a 13.22% fluctuation in either direction.
Currently, the consensus among Wall Street analysts depicts a Hold rating for Lucid Group, structured on one Buy, seven Holds, and one Sell recommendation over the past three months. The average price target of $3.19 indicates a potential upside of approximately 31.82% from current levels.
With Lucid’s strategic partnerships and revenue growth, there are hopeful signs for the company’s future prospects, despite the challenges it faces in a competitive market.