Rivian 'Long Term Winner' In EV Sector: Analysts Less Optimistic On Short Term With White House Questions

Rivian Automotive RIVN analysts broke down the short and long-term outlook for the electric vehicle company. Among the items they address is the potential impact of White House policy changes after fourth-quarter financial results.

The Rivian Analysts

Needham analyst Chris Pierce reiterated a Buy rating on Rivian and raised the price target from $14 to $17.
Cantor Fitzgerald analyst Andres Sheppard downgraded the stock from Overweight to Neutral and raised the price target from $13 to $15.
Stifel analyst Stephen Gengaro maintained a Buy rating with a price target of $16.
Benchmark analyst Mickey Legg reiterated a Buy rating with a price target of $18.
RBC Capital analyst Tom Narayan maintained a Sector Perform rating with a price target of $12.

Needham: Pierce says management commentary and a strong balance sheet are highlights from the fourth quarter.

"We continue to see RIVN as a long term winner in the ICE to EV transition given owner satisfaction and passion ahead of launching the more affordable, TAM increasing R2 vehicle, combined with RIVN's strong balance sheet post the Volkswagen joint venture," Pierce said.

The launch of the R2 remains on track for the first half of 2026.

"Given R1 demand concerns, the R2 can't arrive soon enough to drive unit growth to better absorb fixed costs,” he adds.

Pierce said the R2 comes with reduced costs at the start of production, along with being a vehicle that appeals to a wider group of consumers, giving the vehicle dual benefits for Rivian.

Cantor Fitzgerald: Positive gross margins were a highlight in the quarterly results, but guidance for 20225 leads to a downgrade by Sheppard.

"RIVN initiated FY25 vehicle delivery guidance of 46,000 – 51,000, below our preliminary guidance/Visible Alpha consensus of 59,402/55,190," Sheppard said.

Along with the lower-than-expected delivery guidance, Sheppard highlights worsening macro conditions and the likely removal of the $7,500 EV tax credit as negatives for Rivian.

The analyst said Rivian benefits with a "differentiated product offering," its commercial partnership with Amazon and a strategic joint venture with Volkswagen.

"We are encouraged by the company's first positive gross profit, albeit that was driven primarily by the sale of regulatory credits."

Stifel: Rivian had a strong fourth quarter, but still has some bumps ahead, Gengaro said in a new investor note.

The analyst said the long-term story for Rivian is still "intact."

"Overall, we view the print and outlook as about neutral for the shares near-term, and supportive of our positive longer-term view for RIVN," Gengaro said.

The analyst highlighted the company's capital infusion from the Volkswagen joint venture and the Department of Energy loan that will fund operations for the ramp of R2 at the Normal, Illinois facility and for the R2 and R3 production being built out in Georgia.

Benchmark: The company achieving gross profitability is a major milestone given a challenging macro environment, Legg said in a new investor note.

"The path to profitability remains intact," Legg said.

The analyst said macro concerns remain for the short term.

"We remain optimistic on operational efficiencies in 2025 and the launch of R2 in 2026, which in our view should propel RIVN to a profitable scale."

Legg predicts that 2026 could be "a breakout year for the company."

RBC Capital: After fourth-quarter results, Narayan questions the company's future with the new White House administration and potential policy changes.

"Questions over the new administration's approach to the DOE loan as well as on how R2 will fare without IRA consumer credits, still remain," Narayan said.

The $6.6 DOE loan is also under scrutiny by the current White House administration, which could Rivian's future liquidity.

The analyst also has questions on Rivian's upcoming debt maturities, which includes $1.2 billion due in 2026.

"Ultimately, a lot rests on the company's ability to improve its underlying Gross Profit performance, excluding regulatory credits."

Price Action: Rivian stock is down 5.5% to $12.86 on Friday versus a 52-week trading range of $8.26 to $18.86. Rivian stock is down 17% over the last year.

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