RACE - Lucid: Weak Fundamentals And Unfair Valuation

2024-04-30 10:12:42 ET

Summary

• Lucid is a luxury electric vehicle manufacturer with limited market presence and currently only one model, the Lucid Air.
• Lucid's deliveries grew slower than the overall US EV market, indicating deteriorating market share.
• Intense competition from larger players like Tesla poses a challenge for Lucid in terms of pricing and market share.

My Thesis

Lucid's ( LCID ) market cap nearly reached $100 billion in 2021 amidst the pandemic-driven stock market rally. The company had ambitious plans to challenge Tesla's ( TSLA ) dominance in the EV industry. However, its market share in the U.S. EV market in 2023 comprised a modest 0.55%, lower than in 2022. The EV industry is highly competitive, especially in the luxury segment dominated by established European giants and Tesla....

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