Trading Strategies For Rivian Stock Heading Into Q3 Earnings

Rivian Automotive, Inc RIVN was trading near flat on Tuesday as the company heads into its third-quarter earnings print after the market close.

Analysts expect the company to report EPS of negative $1.33 on revenues of $1.31 billion for the quarter ending Sept. 30.

On Oct. 27, Cantor Fitzgerald analyst Andres Sheppard upgraded the stock from Neutral to Overweight and announced a price target of $29.

When Rivian printed its second-quarter earnings report on Aug. 8, the stock plunged almost 10% the following day and lost an additional 12.17% over the 11 trading days that followed.

For that quarter, Rivian reported a loss of $1.08 per share, which came in ahead of Street estimates of a loss of $1.41 per share. The company also posted a top-line beat, reporting revenues of $1.12 billion against a $978.9-million consensus estimate.

From a technical perspective, Rivian looks neutral heading into the event, having negated its downtrend but trading under the 200-day simple moving average (SMA). Of course, holding a position in a stock over earnings can be akin to gambling, as stocks can rise following an earnings miss and fall after reporting a beat.

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The Rivian Chart: Rivian began trending in a downtrend on Oct. 2 and has been making a fairly consistent series of lower highs and lower lows. However, on Nov. 3 the stock rose above the most recent lower high to print a higher high at the $18.15 mark, where the stock rejected the 200-day SMA.

• On Tuesday, Rivian was working to print a doji or hammer candlestick, which could indicate the stock will trade higher on Wednesday. If that happens, Tuesday’s low-of-day will serve as a higher low, which would confirm a new uptrend that could send the stock back over the 200-day SMA.
• If Rivian suffers a bearish reaction to its earnings and falls following the print, the stock is unlikely to trade back up toward the 200-day SMA over the short term. If Rivian fails to regain the 200-day, the 50-day will eventually cross under the 200-day, which would cause a death cross to form.
• Rivian has resistance above at $21 and at $21.48 and support below at $15.80 and at $11.68.

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Photo: Rivian