Lucid Group Inc. (NASDAQ: LCID) received a notable upgrade from Morgan Stanley, moving from an “underweight” to an “equal weight” rating. The investment bank also set a price target of $3.00, signaling a more neutral stance on the EV maker’s future prospects. This upgrade comes at a time when Lucid’s stock is trading near $2.35, providing some optimism for investors amid recent volatility.
📉 Mixed Analyst Sentiment Creates Uncertainty
While Morgan Stanley’s rating shift offers a glimmer of confidence, several other firms remain cautious. Recent analyst activity includes:
- TD Cowen initiated coverage with a “hold” rating and a $2.30 target price.
- Needham & Company LLC reiterated a “hold” rating on February 26, 2025.
- Royal Bank of Canada cut its price target from $3.00 to $2.00, maintaining a “sector perform” rating.
- Bank of America downgraded Lucid to “underperform”, slashing its price target from $3.00 to just $1.00.
- Cantor Fitzgerald held a “neutral” rating with a $3.00 price target.
Currently, MarketBeat data shows that Lucid carries an average analyst rating of “Hold” with a consensus price target of $2.69.
💰 Institutional Activity: Hedge Funds Accumulate Shares
Despite the stock’s lackluster performance, institutional investors have been actively adjusting their positions:
- Public Investment Fund (PIF), Lucid’s largest shareholder, increased its stake by 28.8% in Q4 2024. PIF now holds 1.77 billion shares, valued at approximately $5.35 billion.
- Vanguard Group Inc. boosted its holdings by 31.1%, adding 26.17 million shares, bringing its total to 110.3 million shares.
- Two Sigma Investments LP significantly increased its position by 4,320.7%, acquiring 15.85 million shares.
- Renaissance Technologies LLC expanded its position by 342.7%, adding 12.8 million shares.
- Two Sigma Advisers LP also initiated a new position worth approximately $34.1 million.
In total, 75.17% of Lucid’s shares are now held by institutional investors, demonstrating ongoing interest despite the stock’s struggles.
🚗 Lucid’s Current Performance and Financials
Lucid Group’s stock recently opened at $2.35, with a 52-week range between $1.93 and $4.43. The company has a market cap of approximately $7.12 billion, but its financials remain concerning. With a P/E ratio of -1.75, Lucid continues to burn through cash as it ramps up production.
The company maintains a debt-to-equity ratio of 0.77, with a current ratio of 3.71 and a quick ratio of 3.26, indicating a relatively strong liquidity position despite its ongoing losses.
🔥 Key Takeaway: Can Lucid Weather the EV Storm?
Lucid’s stock has been under pressure due to production challenges, increasing competition, and financial losses. While Morgan Stanley’s upgrade offers a temporary boost, the mixed sentiment from other major firms and the stock’s overall underperformance raise questions about its long-term viability.
