-- Lucid (LCID) shares are expected to remain under pressure until incoming Chief Executive Officer Silvio Napoli has had time to evaluate the business and its outlook, Morgan Stanley said in a note Wednesday.
The company suspended its delivery and capex guidance for the year after a "challenging" Q1, with management reporting $781 million adjusted earnings before interest, taxes, depreciation and amortization loss, according to the note.
Morgan Stanley said it expects the losses to remain elevated until the planned 2027 launch of a midsize vehicle. To fund its losses, Lucid has announced a total of $1.05 billion capital raise from Saudi Arabia's Public Investment Fund, Uber (UBER), and a registered public offering, among others, the investment firm said.
Morgan Stanley lowered its 2026 EBITDA estimate by 15%, reflecting lower gross margins given recent underperformance as well as higher operating expenses on account of recent workforce reduction charges. The firm also said it continues to expect 26,000 deliveries versus consensus of 25,000 for the year.
Morgan Stanley cut its price target on the stock to $5 from $10, while maintaining its underweight rating.
Price: $5.90, Change: $-0.35, Percent Change: -5.65%