Lucid Group extends loss after BofA pulls bull rating
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Lucid Group (NASDAQ:LCID) is in reverse in early trading on Thursday after Q4 deliveries fell short of expectations.
On Wall Street, Bank of America cut its rating on the electric vehicle stock to Neutral from Buy due to a loss of confidence in near-term results.
The firm said Lucid's 2023 production outlook of 10K to 14K vehicles was meaningfully below its expectations and noted reservations on the Lucid Air slipped to 28K from 34K to suggest a net decline.
While Lucid noted that production is no longer a bottleneck, the pullouts for BofA were that supply chain is still a challenge and expected to hinder the EV upstart's ability to deliver vehicles to customers with the precise specifications requested. "While we think this makes sense, demand has not kept pace, and we would expect LCID to invest in efforts to build its brand awareness," noted analyst John Murphy.
Murphy and team now expect it could take until 2027 or longer for Lucid (LCID) to break even on an operating and cash flow basis and that the company needs to raise more capital sooner than we had expected.
Shares of Lucid Group (LCID) were down 14.13% in the premarket session to $8.53.
Read the Lucid Group earnings call transcript.