Rivian Automotive's Stock Price Target Lowered by Stifel Nicolaus Analyst

Stifel Nicolaus's Stephen Gengaro lowered their price target on Rivian Automotive (NASDAQ: RIVN) by 21.7% from $23 to $18 on February 26, 2024. The analyst maintained their Strong Buy rating on the stock.

This price target reduction came in response to Rivian Automotive's fourth-quarter and full-year 2023 earnings report, released on February 21. Despite the stock price experiencing a sharp decline following the company's "disappointing" guidance for fiscal year 2024 and the expected impact of near-term headwinds, Gengaro expressed a bullish view on electric vehicle (EV) sales in general and Rivian Automotive's brand recognition and sales in particular. The analyst predicted healthy margin expansion for the company from 2024 to 2026.

According to Rivian Automotive's earnings report, in the fourth quarter of 2023, the company produced 17,541 vehicles and delivered 13,972. They reported a gross loss of $606 million, an improvement from the gross loss of $1 billion in the fourth quarter of 2022. The net loss for the quarter was $1.521 billion, compared to $1.723 billion in the same period the previous year. Revenue for the fourth quarter of 2023 stood at $1.32 billion, with an adjusted EBITDA of $(1.096 billion), an improvement from $(1.461 billion) in the fourth quarter of 2022.

For the full year of 2023, Rivian Automotive reported producing 57,232 vehicles and delivering 50,122. The gross loss for the year was $2.03 billion, down from $3.123 billion in 2022. The net loss for 2023 was $5.432 billion, compared to $6.752 billion in the previous year. The company generated $4.434 billion in revenue, with an adjusted EBITDA of $(3.981 billion), an improvement from $(5.217 billion) in 2022.

RJ Scaringe, the Founder and CEO of Rivian Automotive, acknowledged the challenging macro-economic conditions but expressed enthusiasm for the company's progress in 2023 and their plans for the future. He emphasized the importance of cost efficiency, achieving positive margins, and building a strong go-to-market function to support long-term growth. Scaringe also mentioned the upcoming reveal of the company's next-generation vehicle, R2, scheduled for March 7, 2024.

Other analysts also updated their ratings on February 26, 2024. Barclays analyst Dan Levy lowered their price target by 25% from $16 to $12 and maintained a Hold rating on the stock. Truist Securities analyst Jordan Levy reduced their price target by 57.7% from $26 to $11 and downgraded their rating from Strong Buy to Hold.

Currently, 40% of top-rated analysts consider RIVN a Strong Buy or Buy, while 60% view it as a Hold. No analysts recommend or strongly recommend selling the stock.

Since the release of Rivian Automotive's latest quarterly report on February 21, 2024, the stock price has declined by 30.5%. Year-over-year, the stock is down 42%. During this period, RIVN has underperformed the S&P 500, which has experienced a 27.3% decline.

It is worth noting that Stephen Gengaro, the Stifel Nicolaus analyst who lowered the price target on RIVN, is ranked in the bottom 13% of Wall Street analysts, according to WallStreetZen. Gengaro specializes in various sectors, including Energy and Healthcare.

Rivian Automotive, Inc., is an electric vehicle manufacturer known for producing electric pickup trucks and sports utility vehicles. The company was founded in 2009 and is headquartered in San Jose, CA.

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