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Lucid Group, Inc. (NASDAQ:LCID) Analysts Are Cutting Their Estimates: Here's What You Need To Know

It's been a mediocre week for Lucid Group, Inc. (NASDAQ:LCID) shareholders, with the stock dropping 19% to US$3.02 in the week since its latest yearly results. Despite revenues of US$595m falling 3.9% short of expectations, statutory losses of US$1.36 per share were well contained, and in line with analyst models. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Lucid Group

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After the latest results, the twelve analysts covering Lucid Group are now predicting revenues of US$904.8m in 2024. If met, this would reflect a huge 52% improvement in revenue compared to the last 12 months. Losses are supposed to decline, shrinking 11% from last year to US$1.10. Before this earnings announcement, the analysts had been modelling revenues of US$1.30b and losses of US$1.12 per share in 2024. So there's definitely been a change in sentiment in this update, with the analysts administering a substantial haircut to next year's revenue estimates, while at the same time holding losses per share steady.

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The analysts have cut their price target 15% to US$4.00per share, signalling that the declining revenue and ongoing losses are contributing to the lower valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Lucid Group at US$6.00 per share, while the most bearish prices it at US$2.25. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Lucid Group's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 52% growth on an annualised basis. This is compared to a historical growth rate of 96% over the past three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 14% per year. So it's pretty clear that, while Lucid Group's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. They also downgraded Lucid Group's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Lucid Group's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Lucid Group going out to 2026, and you can see them free on our platform here.

Even so, be aware that Lucid Group is showing 3 warning signs in our investment analysis , you should know about...

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.