Lucid (LCID 0.41%) stock is posting gains Monday. The electric vehicle (EV) company's share price was up 2.6% as of 11 a.m. ET, according to data from S&P Global Market Intelligence. Earlier in the trading session, it had been up as much as 9.2%.
Lucid is gaining ground in conjunction with momentum for the broader market today. As of last Friday, stocks are officially in a new bull market, and enthusiasm appears to be carrying over to this week's trading. In addition to that momentum, Lucid stock may be gaining ground in conjunction with recall from a competitor.
Lucid stock bounces after hitting low
Lucid stock hit a record low last Friday on the heels of news that Tesla was cutting prices on its Model Y vehicles in Germany, France, the Netherlands, and Norway. The price cut was viewed as a bearish indicator for overall demand in the EV industry, adding to recent woes for Lucid investors.
But news also hit late last week that Tesla would be recalling more than 4,300 vehicles in Australia due to software issues that could impact the company's steering wheel. Previously, Lucid had announced that it was recalling more than 2,000 of its Lucid Air vehicles due to component issues that could lead to faulty high voltage coolant heaters.
While Tesla's recall doesn't signal any meaningful shift in the state of the industry, some investors may be looking at its recent recall as a sign that such events are natural growing pains that come with the industry.
What comes next for Lucid?
Lucid is scheduled to publish its fourth-quarter results and host a conference call after the market closes on Feb. 21. The company has already announced that it produced 2,391 vehicles and delivered 1,734 vehicles in the period, but investors will get a closer look at the company's expenses. Management should also provide some guidance on what comes next for the business.
In the meantime, Lucid stock could continue to see volatile trading. The business has continued to ramp up its vehicle production and deliveries, but it's posting high losses and will need to scale far beyond current levels in order to become profitable. While Lucid stock could have big upside, it remains a very high-risk investment at current prices.
