If You Own Lucid Stock, Take a Look at This Durable Stock Instead
Key Points
Lucid is struggling due to significant EV headwinds, resulting in more than 60% of its value evaporating over the past year.
Almost any stock is a good alternative to Lucid, but why not pick one that is on its way to a $1 trillion market cap?
Walmart can weather economic slowdowns and acts as a haven for consumers who look for lower prices.
- 10 stocks we like better than Walmart ›
Lucid (NASDAQ: LCID) used to be a well-known electric vehicle (EV) stock that rode the hype of Tesla (NASDAQ: TSLA) during the pandemic. The stock surged quickly upon its IPO, but the bubble burst a few years later.
Investors can still buy Lucid stock, but it has a market cap just below $4 billion. The EV maker produces luxury electric vehicles, which won't fare well as living costs go up. The expiration of the EV tax credit only makes things worse, suggesting that now is the right time to sell Lucid stock.
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You don't have to invest in declining companies like Lucid or high-risk meme stocks to grow your portfolio. Walmart (NASDAQ: WMT) is a good remedy for Lucid investors.
Swapping high risk with steady growth
Image source: Getty Images.
Walmart isn't a speculative company like Lucid. The retail giant has been in business for more than 60 years and has more than 10,000 locations. This foundation helped the stock more than double over the past five years and get closer to a $1 trillion market cap.
That's a solid return, and it's higher than the S&P 500's return over the past five years. Many investors who chase stocks like Lucid want to hit a home run when singles and doubles work just fine.
It's not like Walmart is slowing down, either. The retailer delivered 5.8% year-over-year revenue growth in the third quarter of fiscal year 2026 while boosting net income by 34.2% year over year. Walmart has the opportunity to expand profit margins in the long run with online ads, and it should continue to attract customers due to its low prices and quality products.
Walmart has a vast lead in retail
While Walmart's concept was innovative when it came out, the company is now building on its success.
Walmart's business model is proven at this point. While artificial intelligence (AI) stocks may produce higher revenue growth rates, investors don't have to go for the flashiest stocks to generate compelling long-term returns.
Few companies can compete with Walmart's number of locations and pricing power. Its low prices make it harder for local retailers to thrive, creating downward pricing pressure. Walmart can keep prices low since it has access to significant bulk order discounts.
Walmart looks poised to thrive in the decades ahead, while Lucid faces a tough road ahead.
Should you buy stock in Walmart right now?
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Marc Guberti has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla and Walmart. The Motley Fool has a disclosure policy.
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