Cue Biopharma: Lucid Capital Markets initiates Buy coverage with PT $4

Cue Biopharma: Lucid Capital Markets initiates Buy coverage with PT $4

Lucid Motors (LCID) has recently announced a significant agreement with Uber Technologies (UBER) and self-driving developer Nuro. The deal, which includes an investment of $300 million from Uber, will see Lucid supply at least 20,000 Gravity SUVs equipped with Nuro's Level 4 self-driving systems to Uber for use in an upscale robotaxi service over the next six years [1].

The deal brings several advantages to Lucid. Firstly, securing 20,000 guaranteed sales over six years is a substantial boost for a company that delivered just 10,241 vehicles in 2024 [1]. Secondly, the Gravity SUVs will be featured in Uber's luxury robotaxi service, potentially increasing Lucid's brand visibility and driving sales among affluent customers [1]. Lastly, the $300 million investment will significantly bolster Lucid's cash reserves, which currently total $3.6 billion, plus an additional $1.3 billion in available credit lines [1].

However, despite the positive aspects of the deal, Lucid's stock rally was short-lived. Analysts attribute this to the ongoing concern about Lucid's cash position. While the company has a substantial cash hoard, it continues to burn through cash due to its high capital expenditure requirements, particularly for developing new models [1]. The company's largest investor, Saudi Arabia's Public Investment Fund (PIF), owns approximately 60% of Lucid, but even PIF may not indefinitely fund the company if Lucid's new models do not achieve profitability [1].

Analysts remain divided on Lucid's stock. Some view it as a cautious buy, given the potential for new models to drive profitability, while others are more cautious due to the uncertainty surrounding the success of these models [1]. The Motley Fool Stock Advisor team, for instance, did not include Lucid Group in its list of top 10 stocks to buy now, highlighting the risk associated with the investment [2].

In conclusion, Lucid Motors' deal with Uber is a significant milestone that addresses some of the company's immediate financial needs and opens new market opportunities. However, investors should remain vigilant about the company's cash position and the success of its new models, which will ultimately determine the stock's long-term trajectory.

References:
[1] https://www.fool.com/investing/2025/08/24/is-lucids-300-million-deal-with-uber-a-buying-oppo/
[2] https://finance.yahoo.com/news/lucids-300-million-deal-uber-140300135.html