Illiquidity and stock returns: Churchill Capital Corp IV (NYSE:CCIV)’s Valuation Assumes a Lucid Partnership

On 02-11-2k21 (Thursday) Shareholders tracking shares of Churchill Capital Corp IV (CCIV) belongs to Financial sector and Shell Companies industry. CCIV flaunted -4.17% to reach at $31.50 during previous trading session. CCIV Inc. has a total market value of 6.52B at the time of writing – representing $207.00M outstanding shares. Turning to other widely-considered trading data, this company’s half yearly performance is observed at 0. If speculation does become reality, then Churchill Capital IV (NYSE:CCIV) will soon take Lucid Motors public via a special purpose acquisition company (SPAC). If we assume that that is indeed the case, does it make sense to buy into CCIV stock now?

Manufacturing in Place

Back in December it was reported that Lucid Motors had completed its Arizona manufacturing plant. The company was in the process at that time of commissioning equipment to manufacture the Lucid Air electric vehicle (EV).

The Casa Grande, Arizona plant is the company’s first and was then anticipated to have an initial production capacity of 10,000 vehicles per year. That number is expected to eventually reach 300,000 annually.

However, the company provided a later press release stating that initial production capacity would be nearer 30,000, with it expected to rise to 400,000 vehicles annually in the future.

If Churchill Capital does merge with Lucid Motors, perhaps some of the proceeds will be used to offset the cost of Lucid’s initial greenfield investment. That investment was part of a $700 million outlay.

Vehicle Lineup

One of the more important considerations is the manner in which models are scheduled to be released by Lucid Motors. While the company’s lowest priced offering, the Lucid Air Pure, costs a hefty $69,900, it will not be the first produced vehicle from the plant.

Lucid Motors maintains that vehicles will leave the production line in the spring of 2021. I suppose that technically could mean as late as June 20, but no word on a definitive date.

In any case, Lucid will release more upscale versions of the Lucid Air when they initially roll off the production line. The Lucid Air Dream will arrive first, followed by the Grand Touring and Touring models. The Dream is scheduled to retail for $162,000, the Grand Touring, $132,000, and the Touring, $88,000. These prices take into account a federal tax credit of $7,500.

The Tesla S long range, Plaid and Plaid+ are fairly comparable to the various Lucid Air trims. If the Lucid Air Dream does make it to market before the end of spring as promised, it will be ahead of Tesla in one regard.

The Tesla S Plaid+ isn’t scheduled for release until late 2021. It will cost $132,990 after tax credits but compares well against the Lucid Air Dream at $30,000 less.

Lucid Revenues

It’s clear Lucid hopes to sell its most expensive model first with the Lucid Air Dream. That would mean higher revenues if it does sell well. Assuming the highest priced model also has the highest margins, the company has a fair strategy.

It is also trying to jump ahead of Tesla before Tesla can release the Plaid+ version of the Model S. Investors can only guess whether that will come to be or not. There’s a fair argument to be made that Tesla has the edge, given that it is so far ahead of Lucid Motors.

Although I cannot find reservation figures, it is known that Lucid Motors has opened several retail locations from which to take orders, in addition to its online portal.

So, how does this relate to CCIV stock? What more do we know other than that it has potential as an investment in the SPAC EV space?

The Takeaway on CCIV Stock

Really, we don’t know much.

If the rumors turn out to be true, and Churchill pairs with Lucid, then sure, CCIV stock will jump. Investors can make that gamble. It’ll work out in the short term. But in the longer term, it’s much harder to evaluate Lucid Motors and CCIV.

Will the Lucid Air models turn out to be good vehicles? Again, nobody knows. Aesthetically, I like them. But that doesn’t mean much. I can’t say I’d invest in CCIV and Lucid, but if the facts I presented above inspire you, there’s a reasonable case there too.

Volume Evaluation

The USA listed company saw a recent price trade of $31.50 and 26,350,020 shares have traded hands in the session. There are 26.53M shares which are traded as an average over the last three months period.

Many investors forget that one of the defining characteristics of the stock market is that it’s a market. Buyers and sellers help determine the price of each stock, and the more buyers and sellers a particular stock has interested in it, the more liquid the market will be. Liquidity can have a profound impact on just how violently stock prices can move in either direction, and the reasons have to do with the nature of the market in a stock’s shares.

Trading volume, or volume, is the number of shares or contracts that indicates the overall activity of a security or market for a given period. Trading volume is an important technical indicator an investor uses to confirm a trend or trend reversal. Volume gives an investor an idea of the price action of a security and whether they should buy or sell the security.

Performance Levels

Looking performance record on shares of Churchill Capital Corp IV (CCIV) we observed that the stock has seen a move 0 over the last 52-week trading period. The stock generated performance of 224.74% tracking last 3 months. Investors will be anxiously watching to see if things will turn around and the stock will start gaining or losing momentum over the next few months. If we look back year-to-date, the stock has performed 214.69%. Shares are at 4.24% over the previous week and 122.61% over the past month.

Analyst Views:

Fluctuating the focus to what the Wall Street analysts are projecting, we can see that the current consensus target price on shares is $0. Analysts often put in a lot of work to study stocks that they cover. Wall Street analysts have a consensus recommendation of 0on this stock. This number falls on a one to five scale where a 1 would be considered a strong buy and 5 means a strong sell, 2 shows Buy, 3 Hold, 4 reveals Sell recommendation.

Volatility Insights

Watching some historical volatility numbers on shares of Churchill Capital Corp IV (CCIV) we can see that the 30 days volatility is presently 17.91%. The 7 days volatility is 13.09%. Following volatility data can help measure how much the stock price has fluctuated over the specified time period. Although past volatility action may help project future stock volatility, it may also be vastly different when taking into account other factors that may be driving price action during the measured time period.

The company has a beta of 0. 1.00 indicates that its price is correlated with the market. Less than 1.00 shows less volatility than the market. Beta greater than 1.00 indicates that the security’s price is theoretically more volatile than the market.

The Average True Range (ATR) value reported at 3.69. The average true range (ATR) is a technical analysis indicator that measures volatility by decomposing the entire range of an asset price for that period. A stock experiencing a high level of volatility has a higher ATR, and a low volatility stock has a lower ATR. The ATR may be used by market technicians to enter and exit trades, and it is a useful tool to add to a trading system. It was created to allow traders to more accurately measure the daily volatility of an asset by using simple calculations. The indicator does not indicate the price direction; rather it is used primarily to measure volatility caused by gaps and limit up or down moves. The ATR is fairly simple to calculate and only needs historical price data.

Technical Considerations

Churchill Capital Corp IV (CCIV) stock positioned 144.62% distance from the 200-day MA and stock price situated 96.49% away from the 50-day MA while located 27.25% off of the 20-day MA.

RSI value sited with reading of 54.55. Relative Strength Index (RSI) is an extremely useful and popular momentum oscillator. The RSI compares the magnitude of a stock’s recent gains to the magnitude of its recent losses and turns that information into a number that ranges from 0 to 100. It takes a single parameter, the number of time periods to use in the calculation. In his book, Wilder recommends using 14 periods.

Observing the Technical Indicators:

Churchill Capital Corp IV institutional ownership is held at 28.30% while insider ownership was 0. As of now, CCIV has a P/S, P/E and P/B values of 0, 0 and 0 respectively. Its P/Cash is valued at 0. The Company’s net profit margin for the 12 months at 0. Comparatively, the gazes have a Gross margin 0.

Profitability ratios:

Looking into the profitability ratios of CCIV stock, an investor will find its ROE, ROA, ROI standing at 0, 0 and 0, respectively.

Earnings per Share Details of Churchill Capital Corp IV:

The EPS of CCIV is strolling at 0, measuring its EPS growth this year at 0. As a result, the company has an EPS growth of 0 for the approaching year.

Given the importance of identifying companies that will ensure earnings per share at a tall rate, we later obsession to umpire how to identify which companies will achieve high amassing rates. One obvious showing off to identify high earnings per portion count together companies are to locate companies that have demonstrated such build up beyond the p.s. 5 to 10 years.

The payout ratio shows the proportion of earnings paid out as dividends to shareholders, typically expressed as a percentage of the company’s earnings. The payout ratio can also be expressed as dividends paid out as a proportion of cash flow. The payout ratio is also known as the dividend payout ratio. The Company’s payout ratio was 0 and Price to free cash flow remained $0.

Jessica Wilson

About Jessica Wilson

I am Jessica Wilson Senior News Writer for alphafinews.com. I covers Financial sector and writes about hot Financial companies from an exclusive and “out of the box” perspective. Over the 7 years, I have built a network of resources within the financial sector I writes about. I hold MS degree in the field of Finance. My most recent work incorporates a promoting article on the portable site plan that objectives organizations hoping to make their sites amicable to versatile clients. The greater part of my articles mixes some type of examination with the composition process itself. I work on a full-time basis for Alpha Finews Update specializing in quicker moving active shares with a short-term view on investment opportunities and trends. I have been active in the markets for some years, and I mainly focused on long/short equities. Exceptionally qualified Senior Business Writer with over seven years of showed involvement in marketable strategies and awards.

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