Investors were not impressed with Lucid’s (NASDAQ:LCID) latest quarterly results, sending shares down ~14% in Thursday’s trading session.
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In 4Q22, the luxury EV maker generated revenue of $257.7 million, falling short of Street expectations by $15.89 million, even as the figure marked a big jump from the same period a year ago, when production for the Air sedan just started and the company generated revenue of $26.4 million. The company did post a beat on the bottom-line with EPS of -$0.28 faring better than the -$0.42 anticipated, as the losses also contracted from the -$0.64 delivered in the same period last year.
Production snags throughout 2022 limited the company’s production to just 7,180 vehicles, far below the original target of 20,000 but better than the reduced production guidance of 6,000-7,000 vehicles. For 2023, the company expects it will produce between 10,000 to 14,000 vehicles.
The quarter also represented the second successive one of falling reservations. Having dropped from 37,000 in 2Q22 to 34,000 in 3Q22, these fell further to 28,000 in Q4.
Mirroring depressed investor sentiment, the cumulative effect of all the developments does not alter the bearish view of Morgan Stanley analyst Adam Jonas, even if he does have some nice things to say about the company.
“We remain fans of LCID’s innovative technologies and talented management team. Unlike many other startups, the company has shown an ability to deliver a compelling product to the end customer,” Jonas said. “At the same time, however, the high price point of most of the Lucid Air vehicle line is proving to attract a more limited addressable audience while the financial results suggest the company still has much work to do to reduce the BOM cost to a level anywhere near the price of the vehicle.”
Based on that assessment, Jonas expects the stock to fall further. The analyst rates LCID an Underweight (i.e., Sell) along with a $5 price target, which implies a ~42% downside from current levels. (To watch Jonas’s track record, click here)
It should be noted, however, that Jonas is by far the Street’s most prominent LCID bear. Elsewhere, the stock claims an additional 3 Buys and 4 Holds for a Hold (i.e. neutral) consensus rating. Additionally, the $12.67 average target implies ~13% upside from current levels. (See Lucid stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
