Shares of EV maker Lucid Group (LCID +0.58%) were trading higher again early Tuesday, a day after a huge one-day gain that mystified veteran Wall Street observers.
As of 11 a.m. ET, Lucid's shares were up 10.7% from Monday's close, and up 36.6% on the week so far.
Lucid plans to begin production of its second model, a large luxury SUV called the Gravity, later this year. But that isn't why the stock surged on Monday. Image source: Lucid Group.
Sometimes stocks make unexplained moves, but Lucid's was a whopper
It's not uncommon for a stock to make a significant move that doesn't seem to be driven by news, especially when the company is a not-yet-profitable entrant in a much-hyped space like electric vehicles.
But Lucid's move on Monday was remarkable for the size -- 27% -- and for the volume of shares traded: Almost 124 million shares of Lucid traded hands on Monday, far above its average volume of about 38.3 million.
Lucid did reveal last week that it's working on a third model to follow the Air sedan and large Gravity SUV. It's reportedly a midsize electric crossover expected to start around $50,000. That's roughly the same ballpark as Tesla's huge-selling Model Y and seemingly just the kind of vehicle Lucid needs to help increase its sales.
The report that a more affordable Lucid is on the way is good news for shareholders frustrated by the slow sales of Lucid's flagship Air sedan, but it wasn't exactly a surprise. It definitely wasn't the kind of surprise we'd expect to drive a 27% surge in the stock a few days after the news was widely reported in the automotive media.
So what's going on?
I think Barron's Al Root spoke for many of us when he wrote late on Monday that "it's not clear exactly why" Lucid stock had its best day in about a year yesterday. Here on Tuesday morning, with the upward move continuing, it still isn't clear.
NASDAQ: LCID
Key Data Points
If something is up, Lucid might tell us in February
If something is going on behind the scenes, we may have to wait a few weeks to hear about it from the company. Lucid is scheduled to report its fourth-quarter and full-year 2023 results after the U.S. markets close on Feb. 21.
