Morgan Stanley Just Cut Lucid's Price Target By 50%. Here's Why.

Lucid Group (LCID) stock closed in the red on Wednesday after senior Morgan Stanley analyst Adam Jonas reiterated his “Underweight” rating on the electric vehicle (EV) company. 

As LCID posted Q1 results that fell short of Street expectations on both the top and bottom lines, Jonas cut his price target on the automotive technology company from $10 to $5 as well. 

Lucid shares have been a disappointing investment in 2026, currently down more than 45% versus their year-to-date high in early January. 

Why Morgan Stanley Turned Bearish on Lucid Stock

Jonas’ bearish call on LCID shares was prompted by a confluence of operational setbacks, including a 29-day stop-sale on the Gravity SUV due to a quality defect in second-row seats. 

This supplier issue also made the Nasdaq-listed firm pull its production guidance for 2026 this week. Plus, an unresolved CEO transition has left investors without visibility on the near-term trajectory as well. 

According to the Morgan Stanley analyst, Lucid will likely remain under pressure until incoming CEO Silvio Napoli completes his operational review and provides a strategic update. 

Note that LCID currently sits decisively below its major moving averages (MAs), with an RSI in the mid-30s indicating intense selling pressure. 

Q1 Earnings Warrant Selling LCID Shares

Lucid stock remains unattractive because the supplier issue has already proved devastating to its Q1 earnings. 

The company produced 5,500 vehicles but delivered only 3,093 in the first quarter, with the seat defect causing more than $200 million in revenue impairment. 

With LCID still selling vehicles at about half the production cost, indicating deeply negative gross margins, and quarterly cash burn exceeding $1.4 billion, it’s hard to justify owning this EV stock in 2026. 

At the time of writing, Barchart also has a “100% SELL” opinion on Lucid based on 13 distinct technical indicators. 

What’s the Consensus Rating on Lucid Group?

On the flip side, other Wall Street analysts seem to disagree with Adam Jonas on LCID stock. 

While the consensus rating on Lucid Group remains at “Hold," the mean price target of about $13 signals potential upside of more than 100% from here over the next 12 months. 

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