Rivian Heads In The Right Direction: Anaysts Lower Price Targets, Remain Cautiously Optimistic

Electric vehicle Rivian Automotive RIVN recently shared updates on production on the heels of its third-quarter financial results.

Here are the reactions from analysts:

• Wedbush analyst Daniel Ives has an Outperform rating and lowers the price target from $45 to $37.
• D.A. Davidson analyst Michael Shlisky maintains an Underperform rating and lowers the price target from $27 to $23.
• RBC Capital analyst Joseph Spak has an Outperform rating and lowers the price target from $61 to $50.
• Mizuho analyst Jason Getz keeps a Buy rating and lowers the price target from $65 to $58.
• Needham analyst Vikram Bagri has a Hold rating and no price target.

Read on for key takeaways:

Related Link: How To Trade Rivian Stock Before And After Q3 Earnings 

Wedbush

Rivian's third quarter was a “step in the right direction,” Ives said, citing firm demand and a continued ramp-up of production.

“Rivian delivered a good quarter which importantly shows deliveries, reservations and production all moving in the right direction,” Ives added.

Ives remains “cautiously optimistic” that the company's headaches are behind it. “We believe this story is still only in the very early innings of playing out with the production piece now really starting to be in place heading into a very important year ahead as the EV arm race plays out.”

D.A. Davidson

Rivian has “many hills left to climb” and faces tough conditions, Shlisky said.

“That said, there were some unexpected items that keep us cautious, namely the push out of the R2 platform to 2026 and the sudden suspension of the disclosure of the pre-order backlog,” he added. “We continue to be fans of the truck, but not necessarily the stock.”

RBC Capital

There are signs of improvement at Rivian, according to Spak. However, there are also several potential negative items to watch.

“We see 2023 consensus moving lower closer to us and the R2 program was pushed by a year. So could be some near-term noise, and we do lower our PT to $50, but still like mid-to-long term opportunity,” Spak said.

Mizuho

Getz noted Rivian's "soft" revenue,

“Lowering estimates and price target to $58 with sentiment and peer multiples lower given a more challenging consumer demand environment,” Getz said.

Rivian trades at a 44% discount to Tesla Inc TSLA based on a price-to-sales multiple for 2024 estimates. Rivian kept its full-year guidance for production and backlog while Lucid Group LCID cut its backlog in its recent earnings report, he said.

Needham

“Reservation book momentum is consistent with our analysis indicating persistently robust demand for EV pickups/SUVs,” Bagri said, citing disciplined execution.

The stock could get a boost with low expectations for third quarter and strong momentum coming, he explained. “Near to medium term, in the absence of tangible catalysts and a challenging macro backdrop, we expect the stock to remain relatively range-bound.”

RIVN Price Action: Rivian shares are up 15% to $32.22 on Thursday.

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