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Lucid has yet to deliver any cars.

Courtesy Lucid Motors

Lucid Group

—the electric-vehicle start-up run by Peter Rawlinson, who helped develop the


Model S a decade ago—got its first rating from Wall Street Thursday. It is a bullish call.

Citigroup analyst Itay Michaeli launched coverage of Lucid (ticker: LCID). He recommends buying the stock and set a target of $28 for the price. Lucid stock gained 4.9% to close the day at $19.85, while the

S&P 500


Dow Jones Industrial Average

fell 0.5% and 0.4%, respectively.

“Lucid resembles much of what we like about Tesla, but without the lofty 2030 [market] share and [self driving] outcomes that one must underwrite,” wrote the analyst in a Thursday report. He believes the future is in vehicle electrification and autonomous-driving technology. He just doesn’t like the price anyone buying Tesla now must pay.

Michaeli rates Tesla shares Sell and has a target of $209 for the price. That values Tesla at about $200 billion net of cash, while the analyst’s $28 target for Lucid values that stock at about $41 billion, also net of cash.

Lucid, of course, hasn’t delivered any cars. “The [production] ramp will be a key sentiment driver for the next six to 12 months,” added the analyst. He projects Lucid will sell 20,000 units, for $2.2 billion, in 2022.

Analysts currently estimate Tesla will sell about 1.1 or 1.2 million vehicles in 2022 and generate sales of about $69 billion. Sales will be roughly 30 times Lucid’s. Still, Lucid is growing off a smaller base, so investors can expect a faster rate of increase.

Michaeli is the first to launch coverage of Lucid stock, though the company has been in the investing news for a while. It announced plans to merge with a special-purpose acquisition company in February and completed the deal in July Analysts typically don’t pick up coverage of a company until its merger is completed. Even afterward, it can take a while for research to ramp up.

A company with a market value the size of Lucid’s should eventually have 15 or 20 analysts covering its stock. Lucid is one of the most valuable EV players in the world now, trailing behind Tesla and Chinese EV players


(NIO) and


(XPEV). Lucid and

Li Auto

(LI) have very similar market capitalizations.

Lucid stock has hit a rough patch recently. Shares are down about 20% over the past month. Tesla stock is up about 5% over that span, but the three Chinese EV stocks are down about 8% on average.

Most car stocks have been weak.

Ford Motor

(F) and

General Motors

(GM) shares are down about 5% and 9% over the past month. Tesla stock has been the exception to the rule.


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