Lucid Stock ( NASDAQ:LCID )
The most recent production forecast from the electric vehicle start-up Lucid came in significantly lower than expected, which caused alarm bells to sound on Wall Street.
Lucid ( NASDAQ:LCID ) announced on Wednesday evening that the company intends to produce between 10,000 and 14,000 vehicles in 2023. On Wall Street, they were anticipating a number closer to 20,000. In addition to this, the number of vehicle reservations received as of February 21 was 28,000 units, which is a decrease from the 34,000 units reported on November 8.
Additionally, management stated that going forward, it will no longer provide reservation numbers.
On Thursday, shares ended the day with a loss of 11.9%, trading at $8.79, while the S&P 500 SPX and the Nasdaq Composite COMP both posted gains of 0.5% and 0.7%, respectively.
It was not a very successful period. On Thursday morning, the BofA Securities analyst John Murphy changed his recommendation for the shares from Buy to Hold. His price target decreased from $18 per share to $10 per share. Murphy stated that he “substantially” reduced his estimates and that he now anticipates that it will be the year 2027 before Lucid begins to generate positive free cash flow.
According to what Murphy wrote, “the 2023 production outlook of 10,000 to 14,000 vehicles was meaningfully below our expectation.” Prior to reading the earnings report, Murphy had predicted that the company would produce 27,000 units in 2023. We had originally anticipated that Lucid would not have the need to raise additional capital until much later.
The firm reported that it finished the period with approximately $5 billion in liquidity and predicted that this level should be sufficient to carry it through the first quarter of 2024.
Analyst Andres Sheppard from Cantor Fitzgerald maintained his Buy rating on shares of Lucid,...
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