$LCID Files Universal Shelf Registration

Barron’s headline: What Lucid’s Odd Stock-Price Drop Tells Us About Investing

By Al Root
Aug. 30, 2022 12:25 pm ET


Lucid (ticker: LCID) filed a “universal shelf” registration statement that allows it to raise up to $8 billion in any combination of stock, preferred shares, warrants, and debt. That is a large amount, but the registration statement doesn’t mean a huge stock sale is coming soon.

Companies have limits on what securities they can sell without telling their owners—shareholders—first. Shelf registrations give them the ability to raise money when management believes the time is right.

It should surprise no one that Lucid is going to need more capital as it builds out its business. Wall Street projects Lucid will burn through about $8 billion over the next couple of years, while it ended the second quarter with roughly $4.3 billion on the books. Building a car business from scratch, as Lucid is trying to do, is expensive. Tesla used up roughly $9 billion before it began consistently generating free cash flow.

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