Fall after company report
Shares in Lucid Motors (LCID) continued to decline on Tuesday after the electric car start-up, led by former Tesla chief technology officer, reported its quarterly results. Investors and analysts are finding it difficult to value Lucid today.
Electric car maker Lucid Motors (LCID) reported its results for the quarter ended 30 June 2021 on Monday after trading closed On Tuesday, shares of Lucid Motors continued to decline by 1.18%, losing 61% from a high in February. However, the shares bounced back from a low in May, up 16.4% in the last three months.
With Lucid only planning to launch its production this half-year, the Q-10 financial report told investors little.
At the end of the quarter, the company had assets in the form of 207 million shares outstanding, but after Lucid went public on the NASDAQ exchange via a merger with Churchill Capital in July, it already has about 1.6 billion Lucid shares outstanding.
The company did not report earnings in its report, publishing operating losses. The balance sheet at the end of the second quarter was about $2bn in cash, but after the merger closed, Lucid had about $2.4bn net of fees. Lucid now has about $4.4bn in cash on its balance sheet, making it one of the most capitalised start-ups in electric vehicles. The company will use these funds to build and sell its cars. Lucid plans to start production of its first Lucid Air car this year and ramp up production in 2022. The Air will be produced at Lucid's new production facility in Arizona.
Lucid Motors had a market capitalisation of about $37bn at the close of trading on Tuesday.
The company has no earnings until it completes the sale of its first batch of cars, with losses likely to continue for a long time until production reaches scale and reaches profitability.
Lucid hopes to generate about $2.2bn in sales in 2022 and forecasts revenues of nearly $23bn. about a 10-fold increase by 2026. Wall Street analysts have not yet started their valuations on Lucid's stock, according to Bloomberg reports, which should happen in the coming weeks.
At the same time, some experts believe that low liquidity may be a problem for Lucid shares, as there are few institutional shareholders.
