Mizuho maintains Rivian stock rating as R2 launch remains on track

Investing.com - Mizuho (NYSE:MFG) has reiterated its Neutral rating and $13.00 price target on Rivian Automotive Inc (NASDAQ:RIVN) following meetings with the company’s financial leadership. Currently trading at $13.91, Rivian’s stock sits within a broader analyst target range of $7.05 to $23.00, according to InvestingPro data, which reveals the company maintains a FAIR financial health score and holds more cash than debt on its balance sheet.

The electric vehicle maker confirmed its R2 model launch remains on schedule for the first half of 2026, with initial units expected to roll off pilot production lines and order books opening in early 2026, according to Mizuho’s research note. With annual revenue of $5 billion and a concerning gross profit margin of -9.33%, Rivian faces significant challenges in achieving profitability, as highlighted in the comprehensive Pro Research Report available on InvestingPro.

Rivian’s battery supply for the second half of 2026 appears secure for LG AZ NMC batteries, though potential tariff impacts could affect China LFP orders for standard R1 and EDV models, Mizuho noted.

The research firm highlighted that Rivian’s partnership with Volkswagen (ETR:VOWG_p) enables joint volume sourcing of ECUs and displays, which represent 15-20% of the bill of materials, potentially delivering significant cost reductions.

Rivian is taking a conservative approach to ramping up new Electric Delivery Van customers with several pilot programs underway, while management expects some rollback of regulatory credits under the new tax bill but remains optimistic about Department of Energy loan prospects.

In other recent news, Rivian Automotive has announced a $1.25 billion green bond offering, with the proceeds intended to redeem existing floating rate notes due in 2026. This move is part of a broader strategy to manage its debt and support growth initiatives. Cantor Fitzgerald has maintained its Overweight rating on Rivian, citing the company’s debt refinancing plans as a factor in its decision. Additionally, Rivian has priced the green bond offering at an interest rate of 10%, with the transaction expected to close in June 2025. The company is also considering a high-yield bond sale to raise up to $2 billion, led by JPMorgan Chase (NYSE:JPM) & Co., to further refinance its upcoming debt obligations.

Furthermore, Rivian has laid off approximately 140 employees from its manufacturing team, representing about 1% of its total workforce, to improve operational efficiency ahead of the R2 SUV launch. In another development, the company has hired Kyle Nees as Senior Director of Vehicle Programs, bringing experience from his previous role at Lucid (NASDAQ:LCID). These recent developments highlight Rivian’s ongoing efforts to strengthen its financial position and streamline operations in a competitive electric vehicle market.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.