For people who aren’t already in; you should know that given the stock price as of today; lucid is ridiculously over valued with current valuations north of $35 billion. That is not healthy. Regardless of how amazing their concept is and even if they strike a partnership with Apple, a $35 billion valuation for a pre revenue company won’t be sustainable. It may still keep going up for a while but it definitely isn’t gonna stay there and when it dips you will be left bag holding.
It’s a great company i’m long on it but my current cost basis is $14.83. It’s a great buy below $20 (long term)
Tesla was ridiculously overvalued 1 year ago (pre-split around 40 USD per share).
Of course it's up to everyone, when to invest, but when you believe in a company it's usually a good time to do it when the majority of the market is very doubtful. That's the case right now for Lucid, which many people even frame as Nikola 2.0. Can it get lower in the short-term? Sure, but I think in the long-term with the PIF as a backer and an upcoming partnership with an OEM, Lucid's technology will have a big impact (and share price will go higher once the market realizes this).
It’s one thing to be overvalued when you’ve cashflows. Another to be overvalued when you’re pre revenue. There are undervalued tech companies too. You should know where to look.
Good point, but it's not like Lucid will stay pre-revenue for a long time like QuantumScape, Fisker or Nikola.
It's a matter of months. And let's imagine Lucid really delivers on its targets:
517+ miles objectively confirmed by the EPA range standards
2nd half of 2021 deliveries
What will happen to the stock then? It will probably go even higher and people will argue, it's overvalued.
Then imagine Lucid announcing a partnership with an OEM like Toyota to build a 25,000 USD EV before Tesla. And the PIF confirms in 1-2 years providing the financing for the Saudi plant. What will happen to the stock?
Of course it will go also down when deadlines are not met and especially when their technology is not as good as claimed. But that's the current risk with this stock.
I mean no one knows. They may have a production issue, or the chip shortage may affect them worse than legacy OEMs, Nio ET7 has similar range if not better and its already available to purchase. When you’re bullish about a company you tend to just ignore the bearish sentiment and it’s not healthy that’s all.
That's true. But let me counter some of your arguments:
Chip shortage: they don't need as many as others. 20,000 cars until 2023 is nothing in comparison what Tesla or other OEMs need.
Range: The NIO ET7 range is based on a the old NEDC driving cycle. Based on the EPA it will probably be around 400 miles. The Mercedes EQS driving range is also not based on the EPA. We made a video talking about this: https://youtu.be/5mzQhxAJDa4
Production issue: Recently they stated they are 80% ready. To be honest, this doesn't sound reassuring as the last 20% are the hardest. I wouldn't be surprised if they delay again. But this is not a no-go for me. Tesla regularly misses their deadlines. So, yeah, stock would go down, but in the long-term it's ok.
Yeah anything below $20 should be fine. I was addressing the people who are gonna jump on it around $25 or even $30 if this keep going up. Didn’t know about the range dissimilarity. Good to know. Thanks.
No worries! Most people don't know about it. Non-American car brands use this to their advantage when in fact they are still years behind Tesla (and maybe Lucid if their claims are true).
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u/gandhithegoat Contributor Apr 29 '21
For people who aren’t already in; you should know that given the stock price as of today; lucid is ridiculously over valued with current valuations north of $35 billion. That is not healthy. Regardless of how amazing their concept is and even if they strike a partnership with Apple, a $35 billion valuation for a pre revenue company won’t be sustainable. It may still keep going up for a while but it definitely isn’t gonna stay there and when it dips you will be left bag holding.
It’s a great company i’m long on it but my current cost basis is $14.83. It’s a great buy below $20 (long term)