Whats up everyone, so if you’re a holder of Lucid stock, you may be
looking at your portfolio and asking yourself what exactly just happened.
Goodness me, the markets may have closed in the green but hey a more than 90% jump in the day to
settle at 43% at market close certainly grabs attention. So in this video, I share with you
what is happening and why I feel Lucid may be on track for further gains, as I don’t think we have
seen the last of Lucid yet. So please stick around to get these latest on this gem, as
here’s an opportunity you want to stay alert on, given the nature of their stakeholder interests.
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That said please drop a quick like on the video and hit the bell, so we can get talking about
Lucid Group Inc (LCID) which is now sitting at $12.87 per share with a market cap of $15.1bn.
Once a favorite of the channel, which we’ve been talking about for a while now, it has had a tough
time in the markets lately, until this news which has seen it rupture by over 43% on the day at
market close. But when you look at Lucid over the past 12m, you very quickly begin to notice that
it is only now beginning to bounce off from its recent lows of $6 per share. Infact it is sitting
up over 100% in the last month. So long may that momentum last, as they are still down by a
significant 52% over the last 12m. So as we always aim to buy low and sell high, the current price
levels are decent entry points given the upside opportunity which they represent. So here’s what’s
hot off the press with Lucid as reported here by Yahoo Finance with you need to be aware of.
Yahoo Finance reported that Lucid stock soared amid a Saudi buyout speculation.
They soared as much as 88% on Friday and were repeatedly halted for volatility
following speculation that Saudi Arabia's Public Investment Fund (PIF) is considering
buying a remaining stake in the luxury electric vehicle startup.
The spike came after a potential deal alert from the website Betaville. So throughout the day,
LCID stock pulled back to some degree, to end up 40% at market close. No official statement
has been made about a takeover bid, neither by Lucid Group nor by Saudi Arabia's PIF.
The stock's parabolic move was also likely intensified by investors covering short positions,
as short interest across the space has surged and is at dangerously high levels following a
disastrous year of EV equity performance, making stocks such as LCID prone to short squeezes.
And LCID’s current short interest is over 25% of the float which is quite significant."
Some of you may already be aware that Saudi Arabia's Public Investment Fund
already owns 65% of Lucid. Lucid (LCID) came public through a SPAC deal in July 2021,
which including PIPE funding from Saudi Arabia's Public Investment Fund. The PIF first invested $1
billion in Lucid in 2018. So if the Saudis buy the remainder of the company, they would likely invest
more heavily in fixing the operational issues which have constrained its production growth.
And this would likely provide a greater degree of viability for the company over the long-term.
The Betaville report also stated that the PIF's long term plan appears to be to take Lucid (LCID)
private and re-list the company on the Saudi Arabian stock exchange in some years time
which sounds interesting. So still very speculative but not impossible.
But here’s some facts which are publicly available which could add some weight to these speculations.
Saudi Arabia's PIF is the country's sovereign wealth fund worth hundreds of billions of dollars.
The fund thus surely has the required means to buy Lucid,
which traded with a market capitalization of $16 billion prior to the rumors.
PIF has a stated mandate of driving the transformation of the Saudi Arabian economy.
And a statement from the fund's official website stated that: Saudi Arabia is currently generating
a large portion of its gross domestic product, and an even bigger portion of the government's income,
from oil production and sales. While that industry is doing very well in the current environment,
the country's leadership has a goal of diversifying the economy over time.
And this makes sense, as oil revenues will likely not be this high forever. But when one looks at
the coming decades, getting more exposure to other industries makes sense for the country.
All in all, there are thus good arguments for a takeover by PIF,
as it could make sense for both parties -- LCID would likely have easier access to
growth capital and would not feel the same pressure of delivering near-term results,
while buying and growing an EV champion fits well with Saudi Arabia's Vision 2030.
The fact that a takeover of LCID by PIF could make sense does not mean that it will actually happen,
however. It also doesn't mean that investors should buy Lucid now,
following a sizeable jump in its share price, in the hopes of seeing near-term returns if PIF
does indeed make a bid for Lucid. While that could work out in case there is a takeover
bid at a high-enough price, buying Lucid for this purpose seems like gross speculation.
If there is no takeover bid, Lucid Group would most likely see its share price pull right back
to where was trading at around $9 before these rumors emerged, as there's no good
reason for LCID to trade well above that level in case the rumor turns out to be wrong, which
could very well be the case. But prior to this Lucid had been busy with the
growth plans as they recently Opened their First Retail Studio and Service Centre in Montreal,
Quebec. They said the opening of their first retail location in the province of Quebec is
a significant milestone for Lucid in Canada. As Canadians have proven they're serious about EVs,
so they're looking forward to providing Montreal and surrounding areas with
the innovation and dynamic experience of their award-winning lineup of Lucid Air."
And to sum it up, Lucid Produced 3,493 Vehicles
in Q4 2022 and 7,180 in the Full Year 2022, Exceeding their Annual Guidance.
They produced 3,493 Vehicles Produced in Q4, up 53 Percent Sequentially and 7,180
Vehicles Produced in 2022, Exceeding Guidance of between 6,000-7,000 Vehicles. They are set to
Report their Fourth Quarter Financial Results on Wednesday, February 22, 2023 so we can expect some
further updates then either on the speculative bid or more importantly their recent performance and
outlook. Which all put together would be plenty of catalysts and drivers to move the share price.
So clearly one to keep on your radar as we head into February.
So some very very interesting insights worth considering for these ev stocks but
only consider getting in if the price is right for you and if you fully understand the risks.
This video is not financial advice, a buy or a sell recommendation, but is meant to
bring some new and exciting ev stocks to your attention for you to do your own research..
As always I would love to hear from you, so please let me know your thoughts on these top
ev stocks in the comments section below and what other ev stocks are catching your eyes lately.
And If you are new to my channel, please ensure to subscribe and hit the bell so you are notified
when I upload new videos. If you would like to see more videos like this, please check out this
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Thank you so much for being here and I look forward to have you in my next video. Thank you