Lucid Group is sitting in a rare and uncomfortable place: short interest is rising into a borrow market that has essentially closed, and the stock still just surged 15% in a single session.
The borrow picture is about as extreme as it gets. Availability has collapsed to 0.12% — there is barely one share available to lend for every 800 already borrowed. That condition has persisted for most of June, but what's new this week is the cost. Borrowing LCID now runs at 78% annualised, up from roughly 11% in late May — a sevenfold increase in four weeks. The prior note flagged this dynamic on June 27; since then the data has not improved. It has hardened. The ORTEX short score ticked up further to 84.4, placing LCID in the bottom 1st percentile of the universe on both short score and days-to-cover, which FINRA data puts at 4.3 days. Against this backdrop, bears added rather than closed: short interest climbed another 13.5% in a single session on June 25, reaching 20.8% of the free float — up 15% on the week. That is a deliberate choice to pay 78% to hold a position in a stock that just ripped 15%.
The options market is shifting, and it tells a different story from the shorts. The put/call ratio has dropped to 1.20, nearly two standard deviations below its 20-day average of 1.30 — the lowest reading in recent weeks. That means call demand is picking up relative to puts, consistent with traders chasing the move higher rather than hedging against further downside. The contrast with the short book is stark: while option traders are turning less defensive, short sellers are doubling down on an increasingly expensive trade.
The Street is broadly sceptical of the setup. The consensus rating is a sell, with recent analyst activity uniformly moving in one direction. Citigroup — which initiated in March with a Buy and a $17 target — cut to $14 in May. TD Cowen dropped its target from $10 to $7 after earnings. Benchmark downgraded to Hold outright. Every firm that touched the name over the past six weeks moved their view lower. The bull case from Citigroup rests on the Uber partnership and a robotaxi launch as longer-term catalysts; the bear case is simpler — suspended 2026 guidance, ongoing production uncertainty, and the risk of further dilution. The stock at $5.92 trades well below even the most conservative remaining target of $7.
Ownership adds another layer worth watching. Uber Technologies added 24 million shares in its most recent reported period, becoming the second-largest holder with 9.7% of shares. The Public Investment Fund of Saudi Arabia remains the dominant owner at 45.4%. Between them they control over 55% of the company — a float that is already thin and a lending pool that has almost entirely dried up. The insider picture is less dramatic: the Acting CEO, CFO, and several directors all sold small quantities on June 5, all at prices around $5.68. The trades were token-sized and carry low significance scores, but the direction — selling into a stock near multi-month lows — is not encouraging.
Earnings history provides the clearest near-term reference point. The last three quarterly prints each produced a negative one-day reaction, averaging roughly -7% on the day, with the most recent print on June 4 falling 10.6% on the day and an additional 9.6% over the following week. The next event is August 5. Between now and then, the key variables to watch are whether short sellers continue adding at 78% borrow cost, whether the stock's one-day surge attracts further call-side option activity, and whether availability — already as tight as it has been all year — continues to hold near zero or briefly opens up as positions are reassessed.
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