TLDR
- Lucid Group stock fell 3.6% after Stifel Nicolaus cut price target from $3.00 to $2.10
- Company missed Q2 earnings expectations with $0.28 per share loss vs analyst estimates
- Revenue increased 29.3% year-over-year to $259.43 million but fell short of $288.10 million forecast
- 1-for-10 reverse stock split takes effect September 2nd to maintain Nasdaq compliance
- Stock down 34.65% year-to-date with multiple analyst downgrades
Lucid Group stock took another hit Friday, dropping 3.6% during trading after Stifel Nicolaus lowered its price target on the electric vehicle maker. The investment firm cut its target from $3.00 to $2.10 while keeping a hold rating on the shares.
The stock traded as low as $1.99 before closing at $2.00. Trading volume reached 41.1 million shares, down 64% from the average daily volume of 114.6 million shares.
The latest price target cut comes after disappointing second-quarter earnings results. Lucid reported a loss of $0.28 per share, missing analyst estimates by $0.08.
Revenue climbed 29.3% year-over-year to $259.43 million. However, this fell short of the $288.10 million consensus estimate from analysts.
The company’s gross profit and adjusted EBITDA figures both came in below Wall Street expectations. These misses have raised questions about cost efficiency at the luxury EV maker.
Analyst Pressure Mounts
Stifel’s Stephen Gengaro pointed to ongoing challenges in the company’s cost structure. He also cited concerns about reduced production outlook in his research note.
The downgrade from Stifel adds to a string of negative analyst actions this year. Redburn Atlantic downgraded shares from neutral to sell in February, cutting its price target from $35.00 to $11.30.
Bank of America also turned bearish, dropping coverage from neutral to underperform. The firm slashed its price target from $30.00 to $10.00 in the same February timeframe.
Currently, two analysts rate the stock a buy, eight have hold ratings, and two issue sell recommendations. The consensus price target sits at $26.75 according to MarketBeat data.
Reverse Split Looms
Shareholders face a 1-for-10 reverse stock split taking effect Tuesday, September 2nd. The company announced this move on August 21st to maintain compliance with Nasdaq listing requirements.
Under the reverse split, every 10 shares will convert to one share. The adjustment took place after market close on Friday, August 29th.
Institutional investors have been active in the stock despite the poor performance. Two Sigma Investments raised its holdings by 4,320.7% in the fourth quarter, now owning 15.85 million shares worth $47.87 million.
Marshall Wace increased its stake by 2,398.5% in the second quarter. The firm now holds 12.65 million shares valued at $26.70 million.
The company maintains a market cap of $6.08 billion with institutional investors holding 75.17% of outstanding shares. Lucid has a debt-to-equity ratio of 0.92 and current ratio of 2.58.
Looking ahead, analysts expect the company to post -1.25 earnings per share for the full year. Future performance will likely depend on the success of upcoming vehicle launches including the Gravity SUV.
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