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The Lucid Group (NASDAQ: LCID) is compared to electric vehicle leader Tesla and legendary Italian performance vehicle company Ferrari by Bank of America, which today launched a cover on the shares of the electric car company. Bank of America coverage predicts that Lucid stock will jump 50% in the coming years as the company has high expectations from analysts.
Lucid, led by CEO and CTO Peter Rawlinson, a former Tesla employee, is expected to launch his first vehicle, the Air, later this year. After the company went public earlier in 2021 after a merger with Churchill Capital Corp. IV, analysts began to analyze the company’s potential in an emerging market for electric vehicles. Bank of America said the company is undoubtedly a known competitive threat to other companies like Tesla, Rivian and Ford.
Bank of America said in its note to investors that Lucid’s “innovative technology, attractive product, compelling brand, clean sheet manufacturing approach and impressive management” are key factors in the company’s quest. to become number one in the sector. With outstanding and experienced executives, a quality product with the Air Dream Edition, and a full scale manufacturing facility in Casa Grande, Arizona, Lucid has all the makings for success. The question is whether the company can go to the end of production because it has many advantages.
Bank of America analysts take a bullish view of Lucid based on an EV / sales ratio of around 3.0x and an EV / EBITDA multiple of around 37x for the 2025 estimates. Analyst John Murphy said, “This is a premium over TSLA’s initial trading multiples and average multiples of the SPAC OEM EV counterparts, but still a notable reduction from TSLA’s recent trading multiples (over five years). , reflecting our vision of LCID as one of the most legitimate start-ups for electric vehicle manufacturers. The analyst also called Lucid a “Tesla / Ferrari of the new car makers” and said the company is “one of the most legitimate start-up electric vehicle manufacturers.”
Lucid announces Air production preview event at the end of September
Lucid had his first coverage initiated late last week by CFRA analyst Garrett Nelson. In his memo, Nelson said that Lucid has many competitive advantages that stem from its first-class specifications on its upcoming luxury electric vehicle models, a strong balance sheet and management team, and an all-new plant in Arizona. Nelson also added that “LCID seems to tick all the boxes of a newcomer to the industry with endurance. However, the CFRA is also aware of the difficult road it could face based on Tesla’s “formidable competitive gap”, which is likely to slow their expected momentum.
Lucid has a target price of $ 30 from Murphy from Bank of America. John Murphy is ranked 1,070 out of 7,641 analysts and has a success rate of 62% and an average return of 12.1%, TipRanks said.
Disclosure: Joey Klender is not a shareholder of LCID and does not intend to initiate any positions.
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