Should You Buy Lucid Stock While It's at $10 a Share?

• Lucid is an electrical conveyance (EV) start-up trying to interruption into the highly competitory car sector.

• The institution has award-winning technology, but its conveyance accumulation complaint is excessively debased to beryllium profitable.

• A 1-for-10 reverse banal divided successful August 2025 is not a bully motion for the future.

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Lucid Group (NASDAQ: LCID) has made monolithic superior investments into its concern implicit the past respective years. The effect is an award-winning high-end conveyance lineup with industry-leading artillery technology. What is inactive lacking is scale. Here's wherefore lone the astir assertive investors should see buying Lucid banal portion it trades beneath $11 a share.

Lucid is an car manufacturer. More specifically, it makes high-end electrical vehicles (EVs). Right now, however, that favoritism isn't the astir important one. The cardinal is that gathering and selling cars of immoderate benignant requires monolithic supporting infrastructure.

Lucid is inactive successful start-up mode, gathering retired the manufacturing and income level it needs to vie with already established manufacture giants. The superior concern requirements are substantial, with the institution openly telling investors successful the 3rd 4th of 2025 that it lone had capable currency to money its concern done the archetypal fractional of 2027. That was pitched arsenic a positive, but for each but the astir assertive investors, it should astir apt beryllium a informing sign.

The glass-half-empty presumption is that Lucid is simply a money-losing business, with lone six quarters of currency remaining connected its equilibrium sheet. What happens if it can't find caller investors to supply it with the superior it needs to support gathering its business? The reply is not a affirmative one, which is apt wherefore the banal has been successful a dependable downward trajectory for respective years.

Lucid's banal terms presently sits conscionable a interaction supra $10 per share. However, investors request to instrumentality that terms with a atom of salt. That's due to the fact that successful precocious August 2025, Lucid enacted a 1-for-10 reverse banal split. A reverse divided doesn't alteration the percent of a institution a shareholder owns, but it does person the effect of expanding the banal price.

Normally, companies enact reverse banal splits due to the fact that their banal terms has fallen truthful debased that they are astatine hazard of being delisted from a banal exchange. If you bash the mathematics here, Lucid would beryllium beneath $1 per stock if it hadn't made the reverse banal split. That's the level astatine which stocks typically hazard being delisted.

Being delisted makes it importantly much challenging for a institution to entree the superior markets for caller cash. However, a debased banal terms is besides a headwind, which helps explicate the company's preemptive determination to bash a reverse banal split.