- Shares in CCIV up over 18% on Monday at $62.91.
- Churchill Capital and Lucid Motors merger gets closer.
- Weekend reports on Churchill Lucid merger say might happen Tuesday.
Churchill Capital shares continue to be strong as further speculation over the merger with Lucid Motors aired at the weekend. The Churchill Lucid merger could be announced as early as Tuesday according to Bloomberg. This follows on from an earlier report from Reuters that the merger was edging closer. All reports cite sources and are unconfirmed it must be pointed out. However, investors continue to take any news as a positive, and CCIV shares have flown out of the block on Monday.
Buy or Sell CCIV Stock
I'm going to take the fifth on that one as everyone is different, has different objectives, needs, etc. So what to do then if you own Churchill stock? Hold and wait for the merger, sell some of the position to guarantee some profits letting the rest ride, or finally, use a trailing stop to manage your downside. Again it depends on people's risk tolerance, needs, etc. Most holders are very bullish about prospects for CCIV once it becomes Lucid Motors. If it competes with Tesla that is hard to argue with, given Tesla's incredible rise. Now I know traders can become very attached to positions that have a nice profit showing but stocks never go up in a straight line so even if you do decide to sell that doesn't mean you can't buy back again if the opportunity presents itself.
Churchill Capital Stock forecast
So where to from here. Well, we are still waiting on news re the much talked about merger with Lucid Motors. Once/if that is done then the story moves onto how the deal is finalized and what to do with your Lucid shares.
Now I have no idea if the deal goes through or not, I have no insider information, but let's assume the Lucid Motors merger does go ahead then how does it work. So according to the last report from Reuters, CCIV will raise up to $1.5 billion in a PIPE transaction.
A PIPE is a Private Investment in Public Equity, basically a share placement. So new shares are issued at a discounted price. In this case the PIPE I think has to be done at the Churchill IPO price which is $10. Nice for those that get some of the PIPE deal! This is usually offered to institutional shareholders, not retail. So just like IPO's are hard to get involved in for the private guy, PIPE deals are the same. What is different this time is the retail interest and ownership is high in Churchill stock so it may be the case that some PIPE shares have to be offered to retail investors, this is not yet clear so I am just giving a bit of an overview of how it might happen. Usually, a PIPE deal is dilutive to existing shareholders meaning your 1 share in CCIV now becomes a fraction of a share.
Anyway, what is for sure is that someone offering Churchill capital shares at $10 is going to get his hand bitten off so there will be a huge demand to get some, so most investors, whether private or institutional will be disappointed.
Once the process is complete Churchill Capital and Lucid Motors merge and Lucid becomes a public stock and then trades accordingly.
So that was easy! Anyway best of luck to all CCIV holders. I do not have any angle here just merely trying to give a bit of information on how it will work what will happen next. Information is always good but so are trends. The main aim in stocks is to try and ride the trend as long as possible and manage risk to your own needs so you make some tendies!
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