Lucid Group is trading around $3 per share, it just lost valuable tax credits for its electric vehicles, and most analysts are lukewarm on the company. Yet, Lucid stock is up 45% this month and has the benefit of a massive financial backer. Is Lucid a stock to buy?
One reason for the stock's surge is the company's deals announced this month.
On Tuesday, the company said all owners of its Air model will gain access to the North American Tesla Supercharger network starting July 31. Using a $220 adapter and the Lucid app, the Air can travel up to 200 miles for every hour of charging, Lucid said.
The Air is the longest-range electric vehicle, Emad Dlala, the company's senior vice president of power train, said in the announcement.
The company also introduced its 2026 lineup Tuesday, which includes a 6% increase in range for the Lucid Air Touring to 431 miles. The rest of the Air lineup maintains a max range of 512 miles of EPA-estimated range.
Wednesday, Lucid said it is partnering with suppliers of nickel, manganese, graphite and other minerals to accelerate the development of domestic critical minerals for the auto industry. Automakers have faced shortages of key minerals.
On July 17, Uber Technologies announced a "multi-hundred-million dollar investments" in Lucid and self-driving tech firm Nuro to develop a new robotaxi service.
Uber plans a fleet of at least 20,000 Lucid electric vehicles equipped with Nuro's self-driving system over the next six years. The companies expect to launch the services in an unnamed major U.S. city late next year. Uber is reportedly investing $300 million in Lucid as part of the deal.
Lucid Stock: The Saudi Angle
Lucid lists Ayar Third Investment Co. alternatively as "the controlling stock holder of the company" and as the "majority stockholder." Ayar is an affiliate of Saudi Arabia's Public Investment Fund, one of the largest sovereign wealth funds in the world. The fund, through Ayar, is reported to have pumped more than $6.4 billion into Lucid since 2019. The PIF owns upward of 60% of Lucid, according to Saudi financial news site Argaam.
Lucid launched Saudi Arabia's first auto manufacturing facility near Jeddah in 2023. The factory has initial capacity for 5,000 cars per year, with an eventual target for 155,000. The Saudi government under its Vision 2030 road map is aiming for EVBs to account for 30% of its total auto sales, about 500,000 vehicles, within five years.
The government has pledged to buy 50,000 Lucid vehicles, with an option for 50,000 more. But competition is rising. Tesla opened its first showroom in the country in April, and a homegrown Saudi EV brand, CEER, plans its first production in 2026.
Tax Credits And Lucid Stock
The Big Beautiful Bill that President Donald Trump pushed through Congress in early July eliminated several Biden-era tax credits and policies aimed at supporting EV adoption. That included tax credits of up to $7,500 for EV purchases, which are sunsetting at the end of September.
The final bill dropped a $250 annual registration fee for any EV vehicle and a $100 annual fee for hybrids. The fees were meant to make sure EV owners, who pay no gasoline tax, pay their share of federal road maintenance.
Lucid is unprofitable and is expected to continue posting losses this year and next. The company also has negative operating and free cash flow, per FactSet. The automaker gets much of its funding from private equity investors.
Analysts estimate a second-quarter loss of 22 cents a share vs. a year-ago loss of 34 cents. But sales are estimated to surge 37.5% to $275.7 million year over year, according to FactSet. The three-year sales growth rate is 69%, according to IBD Stock Checkup.
Second-quarter results are set for Aug. 5 after the market close.
A dozen Wall Street analysts have hold ratings on Lucid. Two have sell ratings and one has a buy recommendation. Lucid stock has surpassed analysts' average price target of 2.60.
Lucid Stock Ratings, Models, Prices
The stock has an IBD Composite Rating of 47 out of 99, mainly due to its lack of profits. It has a 21-day average true range (ATR) of 8.8%. The average true range is a metric available on IBD's MarketSurge that gauges the characteristic breadth of a stock's behavior. Stocks with a high ATR tend to make large price moves that can trigger sell rules. Stocks with lower ATRs tend to make more incremental moves.
With the S&P 500 and Nasdaq now in a power trend, investors can buy stocks with ATRs up to 8%, though they should be wary of being too concentrated in high-octane names.
Lucid is based in the Silicon Valley city of Newark, Calif., and assembles its vehicles at a factory in Casa Grande, Ariz.
Like rivals such as Tesla and Rivian, Lucid's products are pricey. The company's website Wednesday showed a promotional price for the Air Pure model starting at $69,900, Touring from $78,900 and Grand Touring from $110,900 in the Los Angeles area.
The Gravity Grand Touring SUV starts at $94,900. For a top-of-the-line Air Sapphire, be ready to shell out about $249,000.
In the second quarter, Lucid produced 3,863 vehicles and delivered 3,309. That's an 83% jump in output from the year-ago period and a 38% increase in deliveries. Still, that's a small piece of the pie compared with Tesla's production of 410,244 vehicles in Q2 and 384,122 deliveries.
Is Lucid Stock A Buy?
Shares of Lucid Group peaked at 64.86 several months after the EV maker started trading on the Nasdaq in September 2020. The stock collapsed in the 2022 bear market and continued lower in 2023 and for most of 2024. Shares finally found a footing last November around the 2 price level.
Lucid stock has held that level all year, and is forming a base with a 3.64 buy point. The July 17 gap-up offered an alternative entry that makes the stock actionable now. Shares have rallied more than 45% so far this month — a move enhanced by the stock's low share price.
IBD recommends investors avoid stocks under $10 per share, because they tend to be thinly traded and have light institutional sponsorship. However, Lucid stock has a market capitalization of nearly $9.5 billion and a daily dollar volume of nearly $500 million. That is well above the IBD's recommended floor of $25 million.
This month, the company filed with the SEC for a reverse stock split of 1-for-10.
More than 300 mutual funds own shares, although that's less than half the 800-plus that owned the stock at the end of 2023, according to MarketSurge. Vanguard funds are among the largest owners, holding more than 8% of Lucid stock.
