The high-performance Lucid Air Sapphire is one of the quickest and most advanced EVs yet built. It's a tremendous technological achievement. But at a starting price of $249,000, it won't do much to boost Lucid's overall sales volumes. Image source: Lucid Group.
Shares of electric vehicle (EV) maker Lucid Group (LCID -1.39%) were trading lower on Wednesday afternoon, retracing some -- but not all -- of their gains from a brief revival of the meme-stock frenzy earlier this week.
As of 3:30 p.m. ET, shares of Lucid were down 7.2% from Tuesday's closing price -- but still up about 9% since the end of last week.
Remember the "meme stock" revival on Monday? It's already fading.
Investors who have been around for a few years will recall the eye-opening short-term gains once posted by meme stocks, a group of heavily shorted stocks that were promoted by social media personalities and others -- and that posted impressive (if usually brief) gains thanks to short squeezes earlier in the decade.
Some of those stocks briefly revisited those rocket-ship gains on Monday and Tuesday, after a Reddit user who had been a prominent voice in the meme-stock era posted for the first time in roughly three years.
Lucid's stock, along with shares of other EV makers, had its moments in the meme stock days -- and it posted nice gains on Monday and Tuesday. But it's a different company now, and it's no surprise that those gains have already started to fade.
Lucid has a long way to go before its fundamentals will drive real gains
Lucid in 2021 was a newly public start-up with lofty ambitions. Here in 2024, it's a money-losing EV manufacturer with little hope of profitability until its next wave of new lower-cost "midsize" models launches. Right now, Lucid thinks that will happen in late 2026.
Realistically, that means Lucid is unlikely to reach breakeven until at least 2027, even if Lucid hits its late-2026 target to get the first of its midsize EVs into production. And that means that investors will probably have a long wait until Lucid's stock price gets anywhere near its peak in the meme stock heyday -- if it ever does.
