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On Wednesday, Stifel analysts adjusted their outlook on Lucid Group Inc. (NASDAQ:LCID) by reducing the price target on the company’s shares to $3.00 from the previous target of $3.50. The stock, currently trading at $2.26, sits within the broader analyst target range of $1.00 to $5.00. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value calculation. Despite the lowered price target, the firm maintained its Hold rating on the stock.
The revision in the price target comes as Stifel analysts assess the potential impact of Lucid Group’s upcoming product launches on the company’s financial performance. The company’s current financial metrics from InvestingPro show concerning trends, with a gross profit margin of -132.4% and significant cash burn. According to the analysts, the introduction of the Gravity SUV and the anticipated launch of a mid-size platform in the second half of 2026 are pivotal for Lucid Group’s long-term success. The analysts believe these new offerings could significantly expand the company’s addressable market and improve the absorption of overhead costs.
Stifel’s analysis points to the importance of these future product launches in enhancing Lucid Group’s market position. The Gravity SUV and the mid-size platform are expected to cater to a broader customer base and contribute to the company’s growth.
In their commentary, Stifel analysts emphasized the critical nature of these developments, stating, "We believe the launch of both the Gravity SUV and the 2H26 expected launch of the mid-size platform are critical to LCID’s long-term success, providing access to a significantly larger addressable market and likely driving materially higher overhead absorption."
Despite these future prospects, Stifel is taking a cautious approach and awaiting further progress in the company’s margins before altering their investment stance. This conservative outlook is reflected in their decision to maintain the Hold rating while they monitor Lucid Group’s performance and margin improvements.
The analysts concluded their remarks by reiterating their position, "We await continued margin progress and maintain our Hold rating with a $3.00 target price versus $3.50 previously." This statement underscores Stifel’s watchful approach as Lucid Group navigates its upcoming product launches and strives to strengthen its financial metrics. InvestingPro subscribers have access to 14 additional investment tips for LCID, along with comprehensive financial analysis and real-time updates on the company’s performance metrics.
In other recent news, Lucid Group Inc. reported its fourth-quarter 2024 earnings, showcasing a revenue of $234.5 million, which exceeded forecasts of $200.5 million. Despite a loss per share of $0.22, this was better than the anticipated $0.25 loss. Lucid’s production in 2024 included 9,029 vehicles, with a plan to produce 20,000 vehicles in 2025. Additionally, Lucid launched the Lucid Gravity SUV, expanding its product lineup.
In analyst updates, Cantor Fitzgerald maintained a Neutral rating on Lucid, highlighting the company’s advancements in electric vehicle technology but expressing concerns over its high negative gross margin and need for additional capital. Meanwhile, BofA Securities downgraded Lucid from Neutral to Underperform, citing potential delays in future projects and lowering the stock price target from $3.00 to $1.00.
Lucid’s entry into the SUV market with the Air Gravity model is expected to boost demand, with deliveries anticipated in 2025. The company is also exploring technology licensing opportunities to enhance its revenue streams. Despite these developments, analysts have noted internal challenges and macroeconomic pressures that could impact Lucid’s future performance.
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