Lucid Group's Stock Is as Cheap as It's Been Since 2021. 1 Thing to Know Before You Buy.

Lucid Group (NASDAQ: LCID) is preparing for a massive jump in sales this year. Analysts are expecting revenue to nearly double in 2025, largely off the back of Lucid's new Gravity SUV platform, which began shipping to customers earlier this year.

Yet shares have fallen by roughly 20% since 2025 began. A lot of that drop has to do with the overall market correction. Most other electric car stocks have also seen their shares struggle, so it's not just Lucid's fault that its valuation has fallen to levels not seen in years.

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But before you jump into this diamond in the rough, there's something you should know about Lucid's trading history.

1 thing to understand about Lucid's trading history

This is not the first time that Lucid's sales growth projections have spiked. In early 2024, analysts also dramatically upped their estimates, forecasting more than 100% annual sales growth. A lot of this had to do with Lucid's smaller sales base, as well as one-time sales to the Saudi government that totaled more than $50 million.

Notably, neither Lucid's stock price nor its valuation multiples changed much during this spike in expectations. Sure enough, growth forecasts came down dramatically before the year was through, following unexpected sales growth weakness.

LCID PS Ratio data by YCharts. PS = price-to-sales.

Right now, you may be thinking that Lucid's valuation is artificially depressed, since a market correction occurred just as sales growth estimates were taking off once again. But as Lucid's trading history proves, its share price hasn't necessarily responded to huge upticks in forecasted growth before. That's due to several reasons.

First, the company is significantly smaller than better-financed competitors like Tesla. Sales may be growing, but the market has remained skeptical as to whether the company can survive long term. Second, Lucid's growth journey hasn't always gone as expected, meaning the market may not assign a higher valuation based on analyst projections alone.

Lucid Group stock sure looks cheap on paper. But I don't expect shares to rise considerably until this growth forecast becomes reality.

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Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.