Lucid: Wake Up. The Saudi Arabia PIF Is Not Your Friend

Summary:

  • Lucid investors want to believe that the Saudi PIF is their friend.
  • I urge these holders to be realistic as the PIF has its interests to safeguard. It even managed to get a decent discount for its stock offering.
  • Lucid’s financing challenges are not over, as the runway is extended by another year. The PIF is smart enough not to undertake significant moral hazard risks.
  • Without a substantial discount on its valuation, I don’t expect Lucid to be taken private by the PIF. Why should they, even if they can?
  • With LCID still priced at a steep premium, the pain likely isn’t over.

Lucid Air Electric Car

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Lucid Group (NASDAQ:LCID) “diamond hands” suffered another setback this week, as the company announced a new $3B stock offering, including $1.8B from its cornerstone investor, the Saudi PIF sovereign wealth fund or SWF.

LCID fell nearly 17% to close yesterday’s

LCID price chart (weekly)

LCID price chart (weekly) (TradingView)


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