Lucid Stock Target Cut to $30: Why Analysts See a Tough Road Ahead

Lucid stock came under renewed pressure after Benchmark sharply lowered its price target to $30. The firm cut its forecast by more than half following the company’s new debt refinancing plans announced this week.

The electric vehicle maker has been trading near its 52-week low, and analysts say the latest move highlights growing concern about Lucid’s cash burn and long path to profitability.

Analysts Slash Forecasts as Lucid Stock Faces New Challenges

Benchmark trimmed its price target for Lucid stock from $70 to $30 while keeping a Buy rating. The reduction amounts to a 57% drop in expectations and reflects the company’s decision to take on significant new debt. According to financial filings and analyst notes shared on Thursday, Lucid will issue $875 million in senior unsecured convertible notes due in 2031. Another $100 million may be added if lenders exercise their greenshoe option.

The notes include a 7% interest rate. That is well above typical corporate borrowing costs and signals that investors view Lucid as a higher-risk company at the moment. The convertible notes carry a 22.5% premium over the last sale price of $16.99, creating a conversion price of about $20.81 per share. This price is close to several fair-value estimates cited by analysts, suggesting the company sought terms that would land near market reality.

Proceeds from the offering will be used to repurchase roughly $756 million in existing 1.25% notes that mature in 2026. Lucid plans to buy them back for about $752 million in cash. That will push out near-term obligations and provide more breathing room for operations. The remainder of the money will go toward general corporate needs as the company continues scaling production.

Lucid’s ability to call the new notes begins in late 2028, but only if the stock trades at least 130% above the conversion price. If the notes eventually convert into equity, they could add between 42 million and 47 million new shares, depending on whether the greenshoe option is used. This potential dilution is one of the concerns highlighted in analyst reports.

Recent financial results showcase both progress and pressure. Lucid reported $337 million in third-quarter revenue, up 68% year over year. Deliveries rose 47% to 4,078 vehicles. But adjusted EBITDA losses widened to $718 million. Analysts from outlets such as Reuters and other market trackers say the company remains dependent on heavy spending to expand manufacturing and build out service infrastructure.

What the New Forecast Means for Lucid and the EV Market

The decision to cut the price target comes as multiple firms grow more cautious. Cantor Fitzgerald also lowered its estimate from $26 to $21, citing reduced production guidance and disappointing earnings. Analysts warn that Lucid must improve its cost structure and reach higher production levels to have a clear path to break-even.

The broader electric vehicle sector is feeling similar strain. Rising interest rates, slowing demand growth, and intense competition from established automakers have created a difficult environment for younger EV companies. Lucid’s luxury sedan is considered technically strong, but financial execution remains the biggest challenge.

Lucid stock now sits at a crossroads. The refinancing buys the company more time, but analysts say the next several quarters will be crucial. Whether Lucid can convert strong engineering into sustainable business performance remains the central question for investors.

FYI (keeping you in the loop)-

Q1: Why did Lucid stock drop after the new analyst report?

Lucid stock fell because Benchmark slashed its price target to $30. The cut reflects concerns about new debt, dilution, and cash burn.

Q2: Is Lucid stock still considered a Buy?

Benchmark kept a Buy rating despite lowering its target. Analysts see long-term potential but warn of significant near-term risks.

Q3: How much new debt did Lucid take on?

Lucid issued $875 million in convertible notes with an option for another $100 million. The notes come with a 7% interest rate.

Q4: Will the new notes dilute existing Lucid shareholders?

Yes. Full conversion could add 42–47 million new shares. This would lower ownership percentages for current investors.

Q5: What are analysts watching next?

Analysts are focused on Lucid’s production scaling, cost reductions, and cash burn over the next year.