Lucid Group Inc. stock got a buy rating from analysts at Bank of America, who on Wednesday said Lucid is the “Tesla/Ferrari” of electric vehicles and is taking advantage of lessons learned by the other two luxury auto makers.
The analysts, led by John Murphy, praised Lucid’s
management team, its “key competitive advantages” such as its Formula E technology, and its “interesting/attractive” product, the Lucid Air ultra-luxury sedan.
“Although this does not mean complete avoidance of the obstacles many EV start-ups have endured from concept to commercialization, we assign much more credibility to (Lucid’s) success in this endeavor,” the analysts said.
Lucid shares rose more than 4% on Wednesday, erasing some of their losses from earlier in the week, including a drop on Tuesday after analysts at Morgan Stanley initiated their coverage on the stock with the equivalent of a sell rating.
Morgan Stanley said that Lucid was a “super premium” electric-vehicle maker that may be able to scale its production, but there’s just too much competition to get too excited about the stock for now.
Lucid shares started trading on the Nasdaq in July after the company’s merger with a blank-check company was approved on a second try a few days earlier. Lucid said at the time that it had $4.4 billion in funding and would be able to “significantly” accelerate its plan to deliver “the world’s best EVs.”
The Newark, Calif., company hopes to start selling the Lucid Air, built at Lucid’s factory in Arizona, in the second half of this year. The car is expect to sell for about $77,000.
The B. of A. analysts set a $30 price target on Lucid, which represents an upside of 52% over Wednesday prices.
Lucid shares have nearly doubled this year, compared with gains of around 19% for the S&P 500 index.