Lucid Group, Inc.

Lucid Group, Inc. (NASDAQ: LCID) Lucid Group, Inc. is an automotive company, which is focused on designing, developing, manufacturing, and selling of electric vehicle (EV), EV powertrains and battery systems in-house using its own equipment and factory.

Key Highlights:

• The company reported YoY increase in a net loss to USD 2,579.71 million in FY21 (ended December 31, 2021) from USD 719.38 million reported in FY20.
• The company's primary suppliers are single-source suppliers, and their inability to provide product components might have a detrimental effect on the company's results of operations.
• On March 24, 2022, the company expanded its presence in Canada by opening a Toronto Studio. This store is the company's second in Canada and the 23rd in its growing North American retail network.
• Increasing cost pressure in the wake of rising inflationary pressure could further worsen the financial performance of the company in the upcoming quarter.
• From the technical standpoint, LCID shares are hovering in long-term bearish trend, with stock traded below its crucial short-term as well as long-term support level of 50-day as well as 200-day SMAs. Moreover, moving averages are also falling, another bearish trend.

Stock Recommendation

Based on the weak financial performance, decline in the bottom line, associated risks relating to the electric vehicle industry, and unfavourable technical indicators, we recommend a "Watch" rating on the stock at the closing price of USD 21.70, up 0.14% as of April 11, 2022.

LCID’s Technical Price Chart (as of April 11, 2022). Source: REFINITIV, Analysis by Kalkine Group

Technical Summary

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavorable movement in the stock prices.

Note 1: The reference data in this report has been partly sourced from REFINITIV. 

Note 2: Investment decision should be made depending on the investors' appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above.