Big Things are Coming for this Luxury Electric Vehicle Maker
A month after its IPO this EV company has taken a big hit. Here’s why that’s a good thing for you.
The electric vehicle market has been one of the most talked about industries on Wall Street this year.
With many of the world’s developed countries pledging to eliminate gas powered vehicle sales within a decade, a swath of EV startups have begun ramping up efforts to grab market share in this industry that is about to explode.
In July, one of the most intriguing companies in the luxury EV niche made its debut on Wall Street.
Lucid Group, Inc. (LCID) made its initial public offering on July 26 through the SPAC Churchill Capital Corp. and surged more than 10% on the first day of trading.
This week, early investors of LCID were stunned when the stock tanked by as much as 19%.
But the reason for the big dip has nothing to do with the outlook of the company. In fact, the fall presents us with a fantastic buying opportunity.
Where’s the money?
After bouncing around near its IPO price for the last month in a choppy market, LCID shares abruptly plummeted on Wednesday’s open – falling from a close of $19.96 to as little as $16.12 during the trading day.
Without a clear catalyst for such a move down – like bad press or disappointing earnings – many investors wondered why such a promising stock would sell off so much, so fast.
After all, Lucid is one of the most highly valued EV manufacturers behind Tesla, and it has yet to even deliver its first vehicle.
The reason for the selloff is simple.
Wednesday marked the first time that some of the biggest early investors in LCID were allowed to sell their shares since LCID went public in July. It’s not uncommon for early investors to offload shares once that lockup period ends.
And with Lucid poised to offer its first vehicle to the market in the near future, the move down could be one of the best buying opportunities in the EV industry this year.
How do I get some?
Since Wednesday’s low, shares of LCID have rallied well – regaining around 15%.
Investors that are bullish on the EV industry are buying up the stock at a discounted rate ahead of what is likely to be a huge catalyst for the stock.
Lucid is nearing the release of its first vehicle – the Lucid Air – in late 2021.
The Air is marketed as a high performance, ultra-efficient EV sedan to compete with offerings from companies like Tesla and Mercedes Benz.
Lucid will also planning to roll out its Gravity performance SUV in 2023.
Lucid claims that its in-house developed technology is “quickest, longest-range, fastest-charging electric car in the world.”
If it can back up those claims, it’s sure to carve out a significant amount of market share in the high-end EV niche.
And this could be one of your last chances to buy shares at this low of a price.
S.C.A.N. Gave Traders an Early Warning on Lucid
On Monday, my proprietary S.C.A.N. system identified unusually large buy orders on LCID call options.
With that information, I advised my Project 303 subscribers to buy into that position in an effort to ride the momentum to big profits – just as we have done many times before.
But S.C.A.N. isn’t just for identifying new profit opportunities. It can also give us warning signs on big potential reversals.
On Tuesday, S.C.A.N. pointed out a seller of 3,000 LCID Calls. That’s a huge order, and a big red flag.
Someone was making a huge bet that LCID was about to take a dive, so I knew it was time to get out.
With that knowledge, I was able to recommend that my subscribers get out of their LCID trades well before the stock plummeted on Wednesday.
So instead of taking a huge loss, Project 303 members lived to fight another day. And in this market, that’s half the battle.
Click here to learn more about how S.C.A.N. gives Project 303 subscribers an advantage you can’t find anywhere else.
In the Spotlight: Vehicle makers are just part of EV’s bright future
While getting new electric vehicles into driveways and garages around the world will be a huge push in the coming years, there’s space that will be crucial to the success of the industry.
Currently, gas stations are king as far as automotive infrastructure is concerned.
Electric vehicle charging stations are still too few and far between in much of America – and many believe they are too slow to be a realistic option for many drivers.
But a handful of companies are stepping up efforts to improve the necessary infrastructure to allow the EV industry to thrive.
ChargePoint (CHPT) is perhaps my favorite in this section of the EV market. The company just crushed its second quarter earnings report and increased its forward guidance for 2021 revenue by $30 million.
As more and more Americans return to their commute as we hopefully get the pandemic under control – combined with the increasing popularity of electric vehicles – ChargePoint is a company to keep an eye on as they continue to expand their reach across the country.