Should You Buy Churchill (CCIV) Stocks On The Hopes Of A Lucid Merger?

2 min read | February 12, 2021 04:29 AM EST | By Kunal Sawhney

Should You Buy Churchill (CCIV) Stocks On The Hopes Of A Lucid Merger?

Churchill Capital Corp IV (NYSE: CCIV, CCIV:US)

Stocks of Churchill Capital Corp IV, another one of Wall Street veteran Michael Klein’s special purpose acquisition companies (SPAC), took off around mid-January following reports of its merger with Lucid. This year so far, the stocks have recorded a growth of almost 215 per cent.

Churchill Capital IV shares even hit an all-time high of US$ 34.65 last week (February 5), and currently records a 52-week high of US$ 36.

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Following the record high last Friday, Churchill IV scrips posted a decline of five per cent this Monday. In this week so far (February 8-11), the stocks fell by about four per cent. Some reports speculate that this decline could have been triggered by the lack of any confirmation from either Lucid or Churchill regarding the merger rumors.

However, if the rumors turn out to be true, experts believe that Churchill IV’s stock price is likely to shoot up. This comes after speculation about how the EV maker’s flagship model, Lucid Air EV sedan, could give Tesla Inc’s Model S sedan a run for its money.

Reports have valued Lucid Motors’ SPAC merger at about US$ 15 billion. Churchill Capital IV generated more than US$ 2 billion in 2020 and had net cash of US$ 1.3 million used in operating activities in the six months ending 30 September 2020, as per its latest SEC filing.

The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.

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