Latest news with #Lucid Group
Globe and Mail
6 days ago
- Automotive
- Globe and Mail
Why Is Wall Street So Bullish on Lucid Group? Here's the $1 Trillion Reason
Key Points Robotaxis could prove to be a multi-trillion-dollar opportunity. Lucid Group's new deal with Uber should add significant value. 10 stocks we like better than Lucid Group › This week, Wall Street analyst Michael Legg upped his price target on Lucid Group (NASDAQ: LCID) to $7 per share. That signals more than 100% in potential upside over the next 12 months. What makes him and other analysts so bullish? The answer is a $1 trillion opportunity. Robotaxis are a $1 trillion opportunity When Tesla launched its robotaxi pilot program in Austin, Texas, last month, analysts were excited about the potential growth effects. Dan Ives, an analyst at Wedbush Securities, believes the robotaxi division could add $1 trillion to Tesla's valuation over the next 12 to 18 months. Cathie Wood, CEO of Ark Invest, believes that the global robotaxi market will eventually be worth around $10 trillion. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » This is what makes the latest news from Lucid so exciting. On July 17, the company revealed that it would be partnering with Uber Technologies (NYSE: UBER) to scale a robotaxi division. The deal calls for Uber to buy 20,000 Lucid Gravity SUVs over the next six years exclusively for this robotaxi service. Uber will also invest $300 million into Lucid -- a critical cash infusion for a money-losing business. Notably, Lucid and Uber already have a shared connection: They're two of the biggest holdings in Saudi Arabia's PIF investment fund. While the Gravity SUVs will be the first model to be used in Uber's robotaxi service, the company revealed that it will "consider future vehicles" -- a nod to the potential of not only adopting Lucid's Air sedan vehicle, but also Lucid's future mass market vehicles, three of which are expected to begin production over the next few years. Uber and Lucid's combined market capitalization is around $200 billion. That's far less than Tesla's current valuation of $1 trillion. So it's possible that Tesla can scale its robotaxi division faster than Uber. But if Uber can scale robotaxis quickly, Lucid will be a direct and major beneficiary. Should you invest $1,000 in Lucid Group right now? Before you buy stock in Lucid Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lucid Group wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $665,092!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,050,477!* Now, it's worth noting Stock Advisor's total average return is 1,055% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025
Yahoo
20-07-2025
- Automotive
- Yahoo
Is Lucid's Reverse Stock Split a Sign of Desperation?
Key Points Lucid announced a preliminary filing for a reverse stock split. Typically, reverse stock splits are done by companies in financial distress. Lucid has no immediate threat of being delisted. 10 stocks we like better than Lucid Group › While all the headlines screamed about Uber Technologies' (NYSE: UBER) partnership with Lucid Motors (NASDAQ: LCID) and Nuro, an autonomous driving technology start-up, and the multimillion-dollar investment between them, there was a separate development that nearly everyone overlooked: a potential reverse stock split. Let's take a look at what exactly a reverse stock split does, what it doesn't do, and what it means for Lucid investors going forward. Is this a desperate move? Fair or foul? EV maker Lucid announced Thursday that it filed a preliminary proxy statement with the Securities and Exchange Commission (SEC) regarding a special stockholders' meeting to authorize the board of directors to complete a reverse stock split of the company's Class A common stock at a ratio of 1-for-10 (1:10). Let's break this development down into what it means, and what Lucid hopes to achieve with its potential reverse stock split. A 1-for-10 reverse stock split simply means Lucid will reduce its outstanding shares by a factor of 10, essentially combining 10 old shares into one new share. The stock price will then be multiplied by 10. In the simplest example, a company with 100 shares with a $1 stock price will reverse split into 10 shares, valued at $10 per share. It's important to note what this doesn't do, which is change the value of what investors own. While the stock price changes, proportionally to the reduction in the number of shares, the company's market capitalization will remain the same, as will the investors' voting power and position value. Now to the question on investors' minds: Is this a sign of desperation? Not necessarily, because there are a few reasons that can drive a reverse stock split. It's true that typically a reverse stock split is done by a company in danger of being delisted from major exchanges such as the NYSE or Nasdaq -- both require companies to maintain a minimum share price of $1.00. If a company's stock price falls below that threshold for 30 consecutive trading days, it receives a deficiency notice and is given a set period to raise its price -- perfect for a reverse stock split. But as we know, Lucid is currently trading at roughly $3.15 per share, and its 52-week low was $1.93 per share. While that's a little close for comfort, especially given the gloomy electric vehicle market currently mitigating tariff impacts, it's not in immediate danger of being delisted. There is also potential upside for Lucid's potential reverse stock split, as many companies try to push the price of their stock higher to entice big institutional investors. Many institutional investors and mutual funds have policies against owning positions in a stock with a price below a minimum value -- raising the price could enable more large investors to jump into the company's stock, pushing it higher. This is not what typically happens, but Lucid's goal is to make its stock more attractive to more investors. What it all means At the end of the day, the market generally views a reverse stock split negatively. It's often a company in financial distress with a falling stock price and potential to be delisted -- not qualities of a great investment. Lucid is still burning through tons of cash, it's still slowly accelerating deliveries -- although consistently, as it's turned in seven straight quarters of higher deliveries -- and much of its future hinges on the success of its new electric Gravity SUV and its upcoming midsize platform that will underpin at least three more electric SUVs. Currently, Lucid has the liquidity to fund operations flawlessly through the second half of 2026, and while the market doesn't tend to favor reverse stock splits, this shouldn't raise many red flags for Lucid investors that they weren't already aware of. Lucid is simply a high-risk, high-reward stock, and big swings in its price are inevitable. Invest accordingly. Do the experts think Lucid Group is a buy right now? The Motley Fool's expert analyst team, drawing on years of investing experience and deep analysis of thousands of stocks, leverages our proprietary Moneyball AI investing database to uncover top opportunities. They've just revealed their to buy now — did Lucid Group make the list? When our Stock Advisor analyst team has a stock recommendation, it can pay to listen. After all, Stock Advisor's total average return is up 1,048% vs. just 180% for the S&P — that is beating the market by 867.59%!* Imagine if you were a Stock Advisor member when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* The 10 stocks that made the cut could produce monster returns in the coming years. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 15, 2025 Daniel Miller has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Uber Technologies. The Motley Fool has a disclosure policy. Is Lucid's Reverse Stock Split a Sign of Desperation? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
20-07-2025
- Business
- Globe and Mail
Lucid Motors Proposes a 1-for-10 Reverse Split: Should Investors Be Worried?
Key Points Exploring how the proposed reverse stock split may impact Lucid stock. Details on a potential game-changing development that sent the stock surging higher. Whether investors can buy the news, or if they should stick to the sidelines instead. 10 stocks we like better than Lucid Group › Stock splits often generate headlines, and investors typically cheer them. However, Lucid Group (NASDAQ: LCID) recently announced that it proposed a 1-for-10 reverse stock split. Unlike a regular stock split, many investors see a reverse stock split as bad news because they typically occur when a stock has lost a significant portion of its value. Lucid fits that description; shares are down over 94% from their all-time high. But Lucid also announced a potential game changer the same day as the reverse stock split, which sent the stock soaring. Should investors worry about the stock and the company's future? What the reverse stock split means for investors Lucid's proposal is for a 1-for-10 reverse stock split. If approved, the reverse split would consolidate every 10 shares into one. So, Lucid's share price, currently $3, would be $30 following the reverse split, but there would be 10% as many shares as before. The bottom line here is that the stock's market capitalization and financial valuation remain unchanged. Stock splits don't mean as much for investors as you'd think, considering all the attention they receive. Usually, the reason for the stock split matters more than the split itself, especially for reverse stock splits. In Lucid's case, the reverse split will help the stock remain compliant with the Nasdaq stock exchange 's minimum share price listing requirements. Additionally, a higher share price may improve the stock's appeal to individual and institutional investors. The scoop on Lucid Group's brand-new partnership Lucid also dropped some major news. It announced a massive partnership with Uber Technologies and Nuro. The venture will have Lucid supply vehicles equipped with Nuro's autonomous driving technology to Uber for use in an autonomous robotaxi program. The deal involves the purchase of 20,000 vehicles over six years. Uber is also making "multi-hundred-million dollar investments" in Lucid Group and Nuro. The joint venture signals Uber's urgency to counter emerging autonomous competition from Alphabet 's Waymo and Tesla 's Cybercab. For Lucid, it provides a much-needed sales boost. The company's electric vehicle (EV) technology has garnered awards, but Lucid still sells far fewer vehicles than needed to sustain its factories and is operating at significant net and cash losses. Should investors worry about Lucid Group? By itself, the reverse stock split shouldn't worry investors. It's the stock's ongoing challenges that should. Share prices rarely experience such severe declines without reason. Lucid has continuously raised funds by issuing new stock. The resulting share dilution has a significant impact on the stock's performance. Uber's investment gives the company a financial incentive to help Lucid succeed, but it's likely going to dilute existing shareholders further. The 20,000 vehicles may also not be enough to get Lucid over the hump. That's approximately 3,333 vehicles annually, or 833 each quarter. It's a nice boost, but it's also unlikely to solve Lucid's volume problems single-handedly. Lucid delivered 3,109 units in the first quarter of 2025, generating $235 million in revenue, but reported a $366 million net loss and a $589 million cash-flow loss. It will still take a home run with its upcoming Lucid Earth, a more affordable SUV than its newly launched Gravity, to generate the volume it needs to operate profitably. Investors would probably be wise to remain cautious, at the very least, until Lucid grows its sales volume to the point where its financial losses become small enough to sustain its business operations without requiring additional fundraising. Until then, Lucid's business and stock could remain under pressure, even with its exciting new partnership. Should you invest $1,000 in Lucid Group right now? Before you buy stock in Lucid Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lucid Group wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 15, 2025
