Lucid Group Inc

Lucid Group, Inc. (NASDAQ: LCID) is a technology and automotive company. The Company is focused on designing, developing, manufacturing, and selling of electric vehicles (EV), EV powertrains and battery systems using its own equipment and factories. It offers its own geographically distributed retail and service locations and through direct-to-consumer online and retail sales.

Recent Financial and Business Updates:

• LCID reported Q2 revenue of USD 150.9 million, driven by the delivery of 1,404 vehicles within the quarter.
• The company's balance sheet witnessed significant reinforcement, with total liquidity amounting to USD 6.25 billion as of June 30, 2023.
• LCID successfully secured a substantial contract with Aston Martin, valued at over USD 450 million, encompassing powertrain and battery system technology. This contract further validates the excellence of LCID's technological capabilities.
• Original pricing for the Lucid Air models has been reinstated, commencing at USD 82,400 for the Lucid Air All Wheel Drive variant.
• LCID finalized a purchase agreement with the Government of Saudi Arabia.
• The production schedule for both the Lucid Air Sapphire and the Lucid Air Pure Rear Wheel Drive remains on course for a mid-September commencement.
• LCID has announced plans to unveil Lucid Gravity in November, with production slated to begin in late 2024.
• Expectations for LCID's future are optimistic as the company strives to meet its 2023 production target of over 10,000 vehicles. It is recognized that expanding the customer base is crucial for growth. Notable accomplishments during the second quarter, including securing a long-term strategic partnership with Aston Martin, are seen as indicators of the quality of LCID's technology. This partnership signifies a significant milestone for Lucid Group's technology division.
• Looking ahead, there is excitement surrounding upcoming developments in the latter part of the year, such as the planned initiation of production for the Lucid Air Sapphire and the Lucid Air Pure Rear Wheel Drive. Additionally, anticipation is high for the unveiling of the new Lucid Gravity SUV scheduled for November.
• The company's successful capital-raising activities in the second quarter, including a substantial portion from the PIF amounting to USD 1.8 billion, have bolstered its financial position. With current liquidity at USD 6.25 billion, LCID expects to fund operations through the launch of Lucid Gravity and extend into 2025.
• Furthermore, strategic efforts aimed at revitalizing marketing initiatives in the luxury and premium segments have resulted in increased brand awareness. These initiatives align seamlessly with the upcoming launch of a new pricing program.
  

Technical Observation (on the daily chart)

Presently, the stock has corrected by approximately 66.22% since reaching its highest point in the past 52 weeks, which occurred on January 27, 2023. The Relative Strength Index (RSI) over a 14-day period stands at 39.28, indicating a state of potential consolidation or a short-term upward momentum. This upward momentum might take the stock closer to a decent resistance level at USD 7.00-USD 7.50. Additionally, the stock's current positioning is below both the 21-day Simple Moving Average (SMA) and the 50-day SMA, which may serve as dynamic short-term resistance levels.  ­­­­­­

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Speculative Buy’ rating has been given to Lucid Group, Inc. (NASDAQ: LCID) at the current market price of USD 5.94 as of September 07, 2023, at 06:55 am PDT.

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing. 

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

How to Read the Charts?

The Green colour line reflects the 21-period simple moving average (SMA) while the red line indicates the 50- period simple moving average (SMA). SMA helps to identify existing price trends. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps with easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

The reference date for all price data, currency, technical indicators, support, and resistance levels is September 07, 2023. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

RSI: Relative Strength Index

USD: United States dollar 

Note: Trading decisions require a thorough analysis by individual. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.