Why Lemonade Stock Is Up More Than 15% on Tuesday

High-tech insurer Lemonade (NYSE: LMND) continues leading the industry into the future. And, analysts are taking notice. Morgan Stanley upgraded Lemonade stock on Tuesday for its future-minded efforts, in fact, citing its new partnership with electric vehicle manufacturer Tesla (NASDAQ: TSLA) meant to address a problem that a growing number of newer car owners face. That is, how to insure self-driving automobiles. Morgan Stanley believes Lemonade's getting a handle on the nascent business, giving it a first-mover advantage.It's not a new offering, to be clear. Lemonade unveiled its autonomous car insurance product back in January, offering roughly a 50% discount to Tesla owners for the miles handled by the EV company's onboard FSD (full self-driving) technology. This pricing model implies fewer accidents occur when FSD is steering the car rather than when human hands are on the wheel. The news went relatively unnoticed though.The news didn't go unnoticed by Morgan Stanley analyst Bob Huang, however. Having had a couple of months to think about it, on Tuesday, Huang upgraded the firm's stance on LMND stock from equal-weight to overweight, while simultaneously raising its price target from $80.00 to $85.00 per share. He explains that this partnership -- which includes providing Lemonade with access to Tesla's self-driving data -- not only serves as the first step toward a new kind of auto insurance, but puts Lemonade in the lead of this paradigm shift. The market responded, sending LMND shares up 15.5% as of 12:15 p.m. ET Tuesday.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool