Why did Lucid shares jump 27%?

Lucid shares jumped 27% in trading in the US market yesterday, amid intense trading, the highest since mid-December, after the company announced at the time the delivery of cars that exceeded analysts’ expectations during the fourth quarter of last year.

Although yesterday’s rise was almost the highest for the company’s shares in a year, they are still down 24% since the beginning of the year and about 38% in 2023, which was a volatile year for the company, which reduced production expectations more than once and reduced employee numbers.

But yesterday’s rise was not accompanied by any data or news from the electric car company, of which the Saudi Public Investment Fund owns 60%.

The rise may have been stimulated by a report published by the Motley Fool investment management company, which said that “a $15,000 investment in Lucid shares could make you a millionaire if the company’s value rises to 70% of Tesla’s current market value of $665 billion.”

Another explanation for the rise in the company’s stock is short covering positions. About 30% of the company’s total shares are subject to short sales, which is a large percentage compared to the average number of shares available for shares of companies listed in the S&P 500 index, which is approximately 1.5%, according to Barron’s website.

The company is scheduled to report its fourth-quarter financial results on February 21, and analysts expect it to report a loss of 29 cents per share, on revenue of $178.4 million.

Analysts expect Lucid’s share price to reach $4.46 within a year, but there is no recommendation to buy the stock, according to data from Bloomberg that monitors the opinions of 18 analysts.