This video on loose, it is brought to you by masterworks, learn more in the description down below and more on them later. Hey everyone kevin here, so i'm here with my father-in-law who's, watching the lucid air dream edition, which looks amazing. As i walk up, you just told me about what happened on the highway uh going up to cupertino and back it drove beautifully. We charged one time and passed we're gon na give it a test.

I've never done this before so we'll see how easy it is and had lunch while we were doing it, it was. It was just great plenty of charging stations, the electrify america ones right. The electrifying americans powers were the charging. It went from 130 miles to 446 miles, so that's pretty awesome and it cost us zero with lucid, at least this model.

It came with three years of free charging at electrify america, so considering the price of gas going up to cupertino and back, which is about 330 miles, each way cost us zero. Yeah yeah now wait a minute. You did stop at charge point though, for like 20 minutes what happened with the charge point charger, so it's been almost an hour of charging and i now have 156 miles, whereas i started with 135 miles. So it's basically 21 miles.

It has given me in almost an hour of charging that is really pitiful, so i don't recommend going to these charging stations in shopping centers unless you just need a quick thing. Just to get you enough juice to get home, be careful of the charge point or other stations because uh they charged at 6.5 kilowatts per hour, and so i charged it for like an hour. They charged us 2.49, and it only gave us like 15 miles. It was, it was ridiculous, uh, that's like paying gas prices, man who wants to do that and also 15 miles for an hour of charge, whereas an hour of charge at the electrify america's stations gave us over 200 miles.

Oh my gosh, so it does actually charge really fast, so fast so fast, and that was at 150 kilowatts per hour and i understand they have the stations that are 350 kilowatts per hour, which i understand that gives you the 200 miles in about 15 minutes. That's just not oh my gosh, it's just great charged me 31 and second of all. Now there's this weird humming noise. That's coming! I don't know what it's from.

Hopefully, it'll go away. So what about when you got it back, because you had uh what ended up being a software bug where you couldn't turn the wheel, it locked up the steering and it made you really concerned about what. If that happened, while you were driving yeah, what did lucy tell you now before we keep going here, we got to talk about masterworks. I have documented on my channel growing my portfolio from zero to over 30 million dollars of net assets, and it's not easy.

I learned about the stock market and the housing market, so i could generate returns and steady income. I got smart on how interest rates and inflation affect the larger investment environment, and that is exactly why i also partnered with mastworks, because masterworks is the first and only art investment platform and the only investment platform valued at over a billion dollars, making them a unicorn. Masterworks brings you that amazing diversity, though this is what we all need in our portfolio: diversity. They bring an exclusive asset class to you.

Masterworks acquires artwork, ranging anywhere from one million dollars to 30 million dollars, and then they securitize that artwork like a painting and they register with the sec and then sell shares of it, which you could buy through their platform. Mastworks link down below this idea isn't new. It's kind of like buying slices of a company, but this is unique in the fact that, instead of it being an ipo for a stock, you kind of get to invest in ipos for paintings. Now the goal for masterworks is to hold the art for three to ten years and then, of course, when they sell it, you end up receiving a portion of the proceeds proportional to your ownership.

Stake just like shares of a company so check out masterworks today, via the link in the description down below, consider diversifying your portfolio with art. They took it back, they were absolutely wonderful. I got ta say they picked up the car on a trailer bed and they they kept it for a few days. They said that they did find like a software bug in the in the steering thing that was correctable and that it would never have been a steering issue.

It was just upon startup which that's when it did occur, oh yeah, so it wouldn't happen. While you were driving, it never happened and i said, hey, listen, would you trust your dad to drive it? You know, that's me basically and or your grandfather, and they said absolutely so i trusted them and they brought it back. They detailed it. They brought it back on a trailer and drove it up to cupertino and, and it just performed, uh wonderful and you said one of their engineers from torrance actually came up to give the car back to you yeah.

He happened to be the one that delivered it and he gave it his blessing and said it's just an awesome card. Now, let's talk a little bit about the lucid valuation. Okay, it's been a while, since we've talked about the loose evaluation, it's been quite a while, in fact, the last time i talked about lucid, lucid, was trading for about 35 dollars per share. That is the last time we pulled up the spreadsheet.

Now i have not modified this spreadsheet at all. You can fact check me by going to my last lucid video. This is what i wrote uh. You know many months ago when, when i did this spreadsheet - and i suggested the following - that there was a downside - miss risk of the goal of trying to get to a thousand deliveries in 2021, which we know their goal ultimately was 560.

They ended up delivering somewhere around uh in the mid 100s by the end of the year. They ended up getting to my model number 214 by roughly january 20th, so obviously very very delayed here. This is going to substantially delay the forecast here, but i'm just going to leave this like this for a moment because imagine if we could get 150 000 lucids out by 2025, that's only in four years, at 80 000 in revenue per vehicle. This spreadsheet we have looked at before, but i want to show something remarkable here.

When we completed this spreadsheet, we projected that, with a 20 margin that is 20 profit on these 80 000 vehicles, uh 80 000 vehicles uh and a 100 times p e ratio in 2025. We would still be sitting at just about 22 cents of earnings per share with unfortunately uh a a uh, more reasonable price by the end of 2025 around 21.53. That's not ideal right because that's kind of where the darn thing is trading at now, and so at the time we had recorded this video. We recognized this had a potential downside of uh nine point: two six percent for five years every single year to get down to that 21.

now. Well, now we're at 21., okay. So now let's go ahead and revise this spreadsheet ourselves. Let's try to be realistic here.

Okay and i'm not trying to sound like a bear, let's just be realistic with it all right, so this was whatever 150 doesn't really matter. 2021 doesn't matter, i think we're gon na have a lot more of a neo-style launch, which neo-style launch is gon na, be going more like hey, it's gon na be a milestone when we get to a thousand vehicles. So if we could honestly get to 8 000 vehicles in 2022 and then maybe 20 000 vehicles in 23, maybe we get to the full production of 2024 figures. Then we're going to need another factory, so massive capex expenses right and that's going to have to ramp and it's not going to ramp very quickly.

I think we're probably more in the neighborhood. If, if i'm being you know a base case scenario here, maybe 50 60 000 vehicles by 2025 - let's, let's go with 60 okay, let's just see what the valuation looks like. Then we go to 60 000 vehicles in 2025. That's four years out, so we're gon na type in here four years out, uh now we're at sixty thousand vehicles, let's assume that they have not gone to their more mainstream vehicles yet and they're still selling the premium vehicles in the range of a hundred ten thousand Dollars so we're gon na bump this revenue per vehicle right because we're scaling back how quickly we think they can actually scale uh their production.

So we should increase the average price per vehicle, given that right now, they're selling them for about 169 i'd say if we got to about 60 000 vehicles in 2025, 110k is probably closer to where we'd be uh, where we would be, i don't think we're gon Na get all the way down to that 80 000 per vehicle. Yet until we get into the hundreds of thousands of vehicles per year, obviously we're going to leave. You know just zeros in here for other things like energy insurance, semis robo taxi, really because this is all more like tesla related right. We're trying to compare this, obviously to tesla, which makes sense uh we're going to use a 20 margin here now we might might be able to bump this.

So, let's bump it let's go ahead and go to where maybe neo sits right now, which is going to be closer to about a 23 cost. So let's go to 77. Let's do that and uh. That's that's pretty much! That's going to be the big number right here, so 77 percent will be the expense that brings 23 percent of gross profit down operating expenses.

Uh yeah probably 15 realistic, i think very realistic here and then, after their tax rate, they might have some credits here and their effective tax rates probably going to be lower. It's going to be more like 14 or 15, especially in the industry they're in, but we're still only going to be sitting at about an eps around 16 cents. A share - let's just get rid of this for a moment here and uh - that's going to put us well at. I suppose we could leave it uh of uh.

Well, that doesn't matter yeah, so we take this 16 cents per share, which i suppose, if i double click this. If i expand this, i think it's a little bit more yeah there. It is it's 1596., okay, so about 16 cents a share and with a future pe of about 100, it brings us to a fair value of only about 16 bucks right. However, we could probably bump the pe here, but now we're getting a little excessive to try to justify where we are today.

I think this is this is excessive, so, unfortunately, i do think that uh, there's still there's still risk here. Right, there's definitely risk in lucid. Now it is a risk asset at 2362, which is about where it is now it is a risk asset. So if, if we do end up hitting some form of bottom here after this march 16th meeting, it wouldn't surprise me to see a little bit of a movement to the upside.

You know i could see it selling for around that 30 range, but i do think that 2930 is going to be a solid resistance for this company until we really start proving ourselves a little bit more. That doesn't necessarily mean that this valuation is off. It just means it's going to be selling with a substantially higher multiple right, but you can see here there's a lot of pressure on this company's valuation, where it is now until it can really prove that it can ramp and right now we're really not proving that The the other issues that we have - and i think this is probably your biggest issue here - is uh. We you know when we took delivery in january of this vehicle, we were told, hey cruise control within 30 days.

Okay, still no cruise control right uh. So here we have 169 000 car with no cruise control. We have lidar and we have all this these cameras. But where is our uh potential autonomous driving, even if it's mapped right, even if it's chevy, cruze style or nvidia style, or maybe an apple partnership? Where is that partnership? Where details on that and for us to really justify tesla style valuations? We have to do two things one we have to.

We have to prove to the consumer that our software suite is killer. We don't have that because lucid doesn't have that partner and they're, not building it out in-house and number two. We have to prove that we can scale production, which is the hardest thing to do in manufacturing vehicles. So as much as i love the vehicle and i'm so happy that they're really taking great care of my father-in-law yeah, they answer every single question.

He has they've got some great people, uh, there's a person who works at lucid, shout out to her winter you're. Freaking. Amazing, you have made my father-in-law such a happy customer, so so important valuation-wise, though you know, you've got an uphill battle. Let's just put it that way.

You know. There's really no no sense in playing with this, because the earnings are going to be so nominal. For so long that this is, you know, this is one of those stocks where diamond hands are needed to be in it because you're going to be on a ride again, i do think there could be an upside movement here in the short term. I think we'll still get rejected at 30..

I don't think we're going to see some of these momentum highs, like we saw at rivien, uh or or lucid at any point in the near future. Here uh, so i certainly wouldn't be buying call options on this. You know if i had shares i'd, probably be selling calls on on little rally days. So, for example, if we rallied up to 28 i'd be selling calls against my position, but it's gon na be a bit.

It's gon na be a minute uh for this uh to really get moving so my thoughts, hopefully that's helpful for you, i'm finding that to be true, really, okay, and because, initially after that happened, you were nervous about driving to cupertino back because we're down in socal Back to ventura from beautiful cupertino, it's a beautiful day up here and the lucid has 413 miles as far as the range goes, so we'll see how it lines up, the trip back to ventura is 313 miles and and no issues no issues whatsoever. I even put that pad in because i didn't want to load the luggage on the stove on the fabric, yeah and and what just happened with somebody on the highway. Here they were driving a bmw next year. We're constantly getting looks from people because it's a unique color scheme and it's a different looking car and it's new and people know about lucids, i guess from the internet but um.

I was driving along the freeway and a bmw passed me on the left and the passenger window went down and some girls stuck her hand down and going yay. You know, like that's amazing. Okay, awesome awesome! Well, it looks great thanks for the update on the loosen right.