Cantor Fitzgerald has reduced its price target for Lucid Group Inc. (NASDAQ:LCID) to $14 from $21 and retained a Neutral rating on the shares. The downgrade follows the electric-vehicle maker's quarterly results and a production forecast that came in below several outside estimates.
Lucid reported fourth-quarter revenue of $522.7 million, a figure that exceeded one consensus estimate cited at about $446 million and another cited at $459.4 million. The company said that revenue for the quarter represented a 123% increase from the same period a year earlier. For the full fiscal year 2025, Lucid delivered 15,841 vehicles and recorded a record 5,345 vehicles delivered in the fourth quarter, increases of 55% and 72% respectively from the prior year.
Despite top-line momentum, profitability remains an issue. Lucid improved its fiscal 2025 gross margin by approximately 42% compared with prior periods, but its gross profit margin is still deeply negative at minus 98% over the last twelve months. InvestingPro Tips flagged the company for weak gross profit margins, and Cantor Fitzgerald pointed to persistent high negative gross margin as one of the reasons behind the reduced price target.
Production and deliveries figures were revised in Lucid's disclosures. The company reported producing 17,840 vehicles in fiscal 2025, a figure that was revised downward from an earlier number of 18,378. Deliveries for the year stood at 15,841 vehicles.
Lucid issued fiscal 2026 production guidance in a range of 25,000 to 27,000 vehicles. That outlook is below Visible Alpha consensus of roughly 34,000 vehicles and below Cantor Fitzgerald's own preliminary estimate of about 39,000 vehicles. Cantor Fitzgerald explicitly cited the lower production guidance, ongoing negative gross margins, additional capital requirements, a worsening macro environment, and tariff uncertainty when explaining its decision to cut the price target.
On the earnings front, Lucid recorded an adjusted loss of $3.08 per share for the fourth quarter, wider than analyst estimates of $2.68 per share. The company’s revenue of $522.7 million outpaced the cited consensus estimate of $459.4 million and marked the 123% year-over-year rise noted above.
Market observers noted that, despite the downgrade and the narrow margins, some valuation indicators show the stock trading at low levels. At the time the data were reported, InvestingPro analysis suggested Lucid appeared undervalued at a market price of $9.92, trading near its 52-week low. Investors and analysts are weighing that valuation against the company's ongoing cash needs and the more conservative near-term production plan.
Overall, the latest Lucid update delivered mixed signals: accelerating top-line growth and record quarterly deliveries on one hand, and widening adjusted losses, substantial negative margins, and reduced near-term production expectations on the other. Those divergent elements underpinned Cantor Fitzgerald's decision to lower the price target while maintaining a neutral stance on the shares.
Key points
- Analyst action - Cantor Fitzgerald lowered Lucid's price target to $14 from $21 while keeping a Neutral rating.
- Operational and financial results - Lucid reported $522.7 million in Q4 revenue, record deliveries of 5,345 vehicles in Q4 and 15,841 for fiscal 2025, but an adjusted loss per share of $3.08 and a trailing gross margin of -98%.
- Guidance and market impact - Fiscal 2026 production guidance of 25,000 to 27,000 vehicles falls below Visible Alpha consensus of ~34,000 and Cantor Fitzgerald's preliminary estimate of ~39,000; stock was noted as trading near its 52-week low.
Risks and uncertainties
- Production risk - Lower-than-expected production guidance could weigh on revenue growth and investor confidence in the auto manufacturing and EV sectors.
- Profitability and capital needs - Persistently negative gross margins and additional capital requirements pose risks to Lucid's financial stability and may influence capital markets and investor appetite.
- Macroeconomic and policy uncertainty - A worsening macro environment and tariff uncertainty could affect supply chains and costs, impacting the broader automotive manufacturing sector.