Benchmark maintains Buy on Rivian stock with $18 price target

On Tuesday, Benchmark analyst Mickey Legg reaffirmed a Buy rating on Rivian Automotive Inc (NASDAQ:RIVN) with a steady price target of $18.00, falling within the broader analyst range of $6.10 to $23.00. According to InvestingPro data, the stock currently trades at slightly above its Fair Value, with analysts maintaining mixed views on its prospects. Legg adjusted the first-quarter vehicle delivery forecast to align with the company’s guidance, now expecting 8,000 vehicle deliveries, a decrease from the previously anticipated 10,000. Despite this revision, Rivian’s full-year delivery expectations remain unchanged, with the company projecting between 46,000 and 51,000 deliveries. Legg’s estimate stands at 46,300, roughly consistent with prior calculations. InvestingPro analysis reveals that while Rivian maintains strong liquidity with a current ratio of 4.7, the company faces challenges with negative gross profit margins of -24.14% and rapid cash burn.

The adjustment in the delivery outlook for the first quarter is attributed to a combination of seasonal effects and constrained demand, which has been partly impacted by the recent Los Angeles fires. Rivian has also announced a planned shutdown of its Normal, Illinois manufacturing facility later this year, which will allow the company to prepare for the launch of its new R2 platform, expected in the first half of 2026.

Legg anticipates that the latter half of 2025 will see a more robust delivery ramp-up as the market expectations adjust and excitement builds for the upcoming R2 platform. The analyst’s maintained Buy rating and price target reflect a steady confidence in Rivian’s market position and future prospects despite the near-term adjustments to delivery forecasts.

Rivian’s strategic planning includes the anticipated plant shutdown, which is a part of the preparation process for the new product line. This move is expected to contribute to the company’s long-term growth and ability to meet industry demands. As the electric vehicle market continues to evolve, Rivian aims to stay at the forefront with its innovative platforms and vehicle offerings.

Investors and market watchers will be keeping a close eye on Rivian’s performance in the coming quarters, particularly in light of the expected increase in deliveries and the launch of the R2 platform. The company’s ability to navigate the challenges of production and demand will be critical to achieving its stated delivery goals and sustaining investor confidence. With revenue growth of 12.09% in the last twelve months and the next earnings report due on May 13, 2025, InvestingPro subscribers can access 12 additional key insights and a comprehensive Pro Research Report, offering deeper analysis of Rivian’s financial health and growth prospects.

In other recent news, Rivian Automotive Inc. has been the focus of multiple analyst reports and strategic developments. Stifel analysts reaffirmed their Buy rating on Rivian, maintaining a $16 price target, citing the company’s progress toward achieving a positive gross profit by the fourth quarter of 2024 and the anticipated launch of the R2 platform. Similarly, Guggenheim Securities adjusted Rivian’s price target to $16 from $18 while maintaining a Buy rating, noting the company’s success in surpassing fourth-quarter gross profit expectations and highlighting constructive cost management for the upcoming R2 model.

Conversely, Bernstein analysts reiterated an Underperform rating on Rivian with a $6.10 price target, expressing concerns over the company’s long-term scalability and potential cash burn. Rivian also announced the appointment of Sreela Venkataratnam as Chief Accounting Officer, bringing her extensive experience from Tesla (NASDAQ:TSLA) to oversee Rivian’s financial operations. Despite facing demand challenges, with retail sales down 9% year-over-year in February, Rivian is navigating a complex market environment.

In the broader automotive sector, General Motors (NYSE:GM) demonstrated resilience with a 9% year-over-year increase in U.S. volumes, contrasting with the industry’s overall decline. Meanwhile, Rivian’s strategic moves, including its joint venture with Volkswagen (ETR:VOWG_p) and focus on autonomous driving technology, are seen as pivotal in strengthening its market position. These developments come amid a challenging policy environment, with potential implications from U.S. trade policy and the Inflation Reduction Act.

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