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Stay Away From F-Rated LCID Shares


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Lucid Group (NASDAQ:LCID) the stock has been lackluster in 2022, to put it politely. Do the EV maker’s finances justify a turnaround? The answer is definitely no, and Lucid’s attempt at an economical electric vehicle is unlikely to convert today’s inflation-ridden consumers into buyers.

Lucid Group likes to talk about luxury in its press releases. Okay, we get it – Lucid’s vehicles are fancy and fast. On the other hand, do drivers in real-life situations really need an electric vehicle that can go from zero to 100 km/h in 3.4 seconds?

It’s fine for racing cars on a private track somewhere, but Lucid Group seems more interested in extreme luxury than practicality. Meanwhile, financial traders might seek excitement from investing in Lucid Group, but all they’re likely to get is an unhealthy dose of disappointment.

What’s going on with LCID actions?

After peaking earlier this year at around $45, LCID stock has consistently punished its loyal investors. Now the shares are trading at less than $9 each.

When will the bleeding stop? This is certainly a thought on the minds of Lucid Group shareholders. A better question, however, is: Why should the bleeding stop?

After all, Lucid Group’s finances are far from ideal. First, Lucid’s cash and cash equivalents balance fell from $6.26 million at the end of last year to just $1.26 million at the end of the third quarter of 2022. .

Is it possible that Lucid Group is running out of money to fund its operations in 2023? This is a matter that potential investors should take seriously. They should also observe that Lucid’s already alarming net profit loss of $497.05 million from the third quarter of 2021, soared to a staggering net loss of $687.52 million in the third quarter of 2022.

Lucid Group vehicles are prohibitively priced

In times of high inflation and potential recession, automakers need to be flexible with their pricing. They can talk about luxury all day long and brag about cars that go from zero to 100 km/h in seconds, that’s all well and good, but it’s no use if people can’t afford it. buy the vehicles.

It’s easy to find Lucid Group press releases that don’t mention pricing. Maybe it’s because Lucid’s management knows full well that the prices would shock and appall some potential customers.

To get some insight into how Lucid priced its vehicles, we looked at a report from the Silicon Valley Business Journal. According to this report, Lucid Group’s lowest-priced EV model, the Air Pure, starts at $87,400. That’s pretty expensive for an automaker’s most affordable vehicle in these tough economic times, don’t you agree?

Lucid’s line of pure electric vehicles is even more prohibitively priced starting at $107,400. Then there’s the Grand Touring line, which starts at $154,000. Additionally, Lucid plans to roll out its Air Sapphire models, which will start at $249,000.

What you can do now

Has Lucid Group management been given the note that inflation is high and many people cannot afford these ultra-expensive vehicles? Are they also aware that decreasing capital position and increasing net profit loss is a major problem?

These are tough but valid questions, and Lucid Group investors should demand simple answers. Until then, LCID stock deserves an “F” rating and should be off anyone’s watch list.

As of the date of publication, neither Louis Navellier nor the member of the InvestorPlace research staff principally responsible for this article holds (directly or indirectly) any position in the securities mentioned in this article.

InvestorPlace

Not all news on the site expresses the point of view of the site, but we transmit this news automatically and translate it through programmatic technology on the site and not from a human editor.
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