3 Rivian Analysts On Q2 Earnings: EV Production, Margins Shine, But Is 'Cash Burn' Ahead?

Shares of electric vehicle company Rivian Automotive Inc RIVN are trading lower Wednesday after the company issued its second-quarter earnings print after the market close on Tuesday.

The report indicated continued momentum in production, improved cost efficiency, the successful introduction of new technologies and enhancement in the customer experience.

Here's what investors need to know, and what top analysts think about the stock.

Earnings By The Numbers: Rivian posted second-quarter revenue of $1.12 billion, beating the Street consensus estimate of $978.9 million. The company reported an adjusted loss of $1.08 per share, which came ahead of the anticipated loss of $1.41 per share.

Rivian’s operating expenses stood at $873 million, a decrease from $1 billion year-over-year. Net loss came in at $1.29 billion, an improvement from $1.71 billion a year ago.

The Irvine, California-based company confirmed the production of 13,992 vehicles in the second quarter, with 12,640 successful deliveries. On a quarter-over-quarter basis, both production and deliveries increased by 50% and 60%, respectively. Read more on the print, and guidance here.

The BofA Analyst: John Murphy reiterated a Buy rating on the stock, and raised the price target to $60.

Murphy emphasized the ongoing theme of stronger revenue, improved gross margins and lower operating expenses, with second-quarter results surpassing expectations due to better gross margins driven by fixed cost leverage, material cost reductions and higher revenue per vehicle.

The analyst nodded to Rivian’s strong liquidity position, eliminating the estimated $5 billion in stock issuances for 2024 and 2025.

Read Also: Why Rivian Shares Look Set To Extend Rally Today

The Mizuho Analyst: Vijay Rakesh reiterated a Buy rating on the stock, and raised the price target from $30 to $32.

Rakesh highlighted the company’s top line at $1.12 billion and the successful delivery of nearly 12.7k vehicles. While Mizuho sees potential cash burn challenges ahead, it maintains a Buy rating based on Rivian’s strong performance and its position in the market, which trades at a significant discount compared to its peers.

The Cantor Fitzgerald Analyst: Andres Sheppard reiterated a Neutral rating and $29 price target on Rivian.

Sheppard acknowledged the company’s improved full-year 2023 outlook and its commitment to achieving positive gross profit by 2024. Rivian’s second-quarter financial results outperformed Cantor's estimates in several areas, including revenue, adjusted EBITDA loss and gross margins.

The company’s liquidity update confirmed its solid position, the analyst said, anticipating funding “through 2025.”

Cantor also underscored Rivian’s innovative approach, launching a Dual-Motor system for its R1 vehicle line, which will likely provide significant cost benefits to the company.

RIVN Price Action: Shares of Rivian are trading 7.95% lower to $22.83, according to data from Benzinga Pro.

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