lucid motors earnings

This week, three EV (electric vehicle) companies namely Lucid Motors (NYSE: LCID), Rivian (NYSE: RIVN), and NIO (NYSE: NIO) would release their earnings for the third quarter of 2022.

Earlier this month, Lucid Motors’ stock fell to its lowest level since the 2021 merger. While the stock has since recovered somewhat it is still down 64% for the year and trades at only about a quarter of its all-time highs. Here’s what analysts expect from the company’s third-quarter earnings.

Analysts expect Lucid Motors to post revenues of around $200 million in the quarter—more than twice what it posted in the previous quarter. However, analysts expect the company to post a net loss of $499 million in the quarter which is similar to what it posted in the third quarter of 2021.

Notably, Lucid Motors stock had slumped after the second quarter earnings release as the company slashed its 2022 production guidance. It said that it would only be able to produce between 6,000-7,000 cars this year, which was half of what it had previously guided for.

Originally, Lucid Motors guided for deliveries of 20,000 in 2022. However, in March, it lowered the guidance to 12,000-14,000 cars amid the continued supply chain issues.

What to Expect from Lucid Motors’ Third Quarter Earnings

During Lucid Motors’ third-quarter earnings, markets would watch the commentary on 2022 and 2023 production guidance. Incidentally, last month, Tesla lowered its 2022 delivery last month during the Q3 2022 earnings release.

The Elon Musk-run company said that its delivery growth in 2022 would be less than 50% even as it maintained the long-term projection of 50% CAGR growth in deliveries.

Musk meanwhile sounded upbeat about the demand. In his remarks, he said “I can’t emphasize enough, we have excellent demand for Q4, and we expect to sell every car that we make for as far in the future as we can see. So, the factories are running at full speed, and we’re delivering a recovery make and keeping operating margins strong.”

While Tesla stock plunged after the Q3 earnings release, analysts were not too perturbed. Morgan Stanley maintained their buy rating on Tesla stock even as it lowered the target price.

Coming back to Lucid Motors, the management might also share insights on how it plans to secure the supplies of key materials. Automakers globally have been scrambling to secure supplies of commodities from lithium to cobalt as they ramp up production.

Analysts might also question Lucid Motors on its proposed plant in Saudi Arabia. The country has recently partnered with Foxconn to produce EVs in the oil-rich nation.

As part of the agreement, Saudi Arabia’s sovereign wealth fund PIF (public investment fund) and Foxconn would form a joint venture under the name Ceer, which would sell EVs under the same brand. PIF is the largest shareholder of Lucid Motors.

Analysts on Lucid Motors Stock

In September Cantor Fitzgerald initiated coverage on Lucid Motors with an overweight rating. It said, “We believe LCID’s luxury and premium vehicles provide greater efficiency, longer range, faster charging and more space relative to its peers.”

It added, “Lucid vehicles are designed to contain a luxurious interior and a compact, efficient exterior that results in more space for the passengers, thus termed the “Space Concept” by LCID.”

Ray Dalio bought more Lucid Motors shares in the second quarter. The billionaire also added more shares of Ford, NIO, and Xpeng Motors in the quarter.

Chinese EV Stocks Have Also Crashed

Chinese EV stocks have also tumbled this year. Xpeng Motors fell to its lowest level while NIO also trades at a fraction of its all-time highs. Chinese EV companies have disappointed markets with their deliveries in the last couple of months. Wall Street analysts have also been cautious about the sector amid tepid deliveries.

However, when it comes to NIO, almost all the analysts are bullish on the stock and rate NIO stock as a buy.

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