Lucid Group (NASDAQ:LCID) reported results for its first quarter as a publicly traded company this week. If Lucid was an established automaker like General Motors (NYSE:GM) or Toyota (NYSE:TM), we would be talking about the bottom line. For what it’s worth, the electric vehicle startup lost 43 cents per share for the third quarter, much steeper than the 25-cent per-share loss Wall Street anticipated. Yet, LCID stock shot up nearly 24% in one day following the report.

No doubt investors were encouraged that Lucid saw 13,000 reservations for the Lucid Air model in the third quarter. Moreover, the company seems to be on stable financial ground, ending Q3 with $4.8 billion in cash.

As Lucid CEO Peter Rawlinson noted in the press release accompanying the Q3 results, “We successfully began production of vehicles for customer deliveries, continued investing in capacity expansion of our manufacturing facility in Arizona, and opened new retail and service locations in advance of the Lucid Air launch.”

All great news if you’re bullish on LCID stock. So is the fact that reservations have continued to pour in, with the company saying it now has more than 17,000 on the books.

As with many EV firms, though, Lucid is an aspirational company. Therefore, the hard numbers don’t matter as much as the story. And what better plot can you devise for an EV upstart than winning one of the automotive industry’s top honors?

Lucid Air Named Motor Trend Car of the Year

The day before the company announced earnings, the Lucid Air was named the MotorTrend Car of the Year for 2022. Winning this prestigious award proves Lucid’s luxury EV can hang with the best of them.

As the publication states:

Were we wowed by the whopping numbers Lucid has been touting recently—up to 1,111 horsepower and 1,390 lb-ft of torque in the Air Dream P edition and up to 520 miles of EPA-official range in the Dream R edition? No. Anyone can buy big numbers by installing giant motors and batteries. Rather, it’s the sophisticated way Lucid achieves them in a package that ranks highly in each of our six key criteria that captured our attention and our calipers.

Those six criteria are engineering excellence, efficiency, advancement in design, performance of intended function, safety and value.

It’s perhaps the last criterion that intrigues me most.

Lucid’s Air Dream Edition costs $169,000, while the standard Luicd Air will run buyers nearly $78,000. Even after a federal tax credit, you’re looking at paying just under $70,000 for the basic model.

But as I’ve written previously, Lucid isn’t bothering with the regular-income crowd. At least not yet.

Management is realistic about the cost structures of EVs. They’re still vehicles for the rich. Eventually, with lower battery costs and economies of scale, Lucid and others can aim for the masses. For now, though, management is only concerned with the segment of the population that can reasonably afford to buy an electric vehicle.

I’ve got to say that this realism is refreshing. And it gives me confidence in LCID stock.

The Bottom Line on LCID Stock

Before I receive a torrent of criticism from the fundamental folks, I’m not naive. At some point, the numbers will matter. When that happens, investors aren’t likely to be blasé about missed earnings projections. However, it’s not fair to judge high school football players by NFL standards. Investors are still trying to assess the viability of the upside narrative.

Narratively speaking, Lucid is firing on all cylinders. It’s got emotional allure. It’s differentiating itself from its competitors. It has award-winning performance. All in all, Lucid has produced a highly desirable vehicle, and desire is a key component in the luxury car segment.

Lucid is laser-focused on what it needs to do to be successful. That means targeting the rich before it targets anyone else. It’s also what makes LCID stock a long-term buy.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.