CFRA Downgrades Lucid’s Rating to ‘Strong Sell’
CFRA analyst Garrett Nelson downgraded on January 6, 2025, Lucid Motors from ‘Sell’ to ‘Strong Sell’ with a price target of $1.00.
“We maintain our 12-month target of $1. We raise our adjusted EPS views to -$1.12 from -$1.15 for 2024 and to -$1.10 from -$1.20 for 2025.
LCID reported Q4 vehicle production and deliveries of 3,386 units and 3,099 units, respectively.
These totals were ahead of our respective production and delivery forecasts of 3,357 units and 2,400 units.
Following the record-high quarterly deliveries total, LCID managed to hit its 2024 production guidance of 9,000 units.
LCID shares have rebounded sharply since hitting a record low of just under $2/share in mid-February, and we lower our opinion one notch to Strong Sell.
In our view, LCID’s cash burn rate remains extremely troubling (averaging $700M-$800M per quarter), it lacks the size and scale to compete with larger automakers (its production rate was only 37 vehicles per day in Q4), and it has had to resort to steep price cuts to sell units (its average vehicle price realizations dropped by almost $16,000 between Q1 and Q3).
LCID will report Q4 earnings on February 25.”
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