It has been a rocky road for Rivian (NASDAQ:RIVN) so far this year. The electric vehicle (EV) producer captured Wall Street’s fascination with its record-setting initial public offering (IPO) in the fall. After riding the wave of the EV boom, though, it has seen growth slow. When Rivian reported earnings yesterday, the company failed to meet expectations. Revenue came in at only $54 million, missing expectations by $6 million. The adjusted loss per share was also $2.43 as opposed to the predicted $1.97. Since the earnings call, RIVN stock been falling steadily. As of this writing, the stock is down more than 6% for the day.
In the report, executives also added that Rivian expects to build only 25,000 EVs this year. This is a modest amount by industry standards. Last year, at its IPO roadshow, Rivian had forecast twice that number.
Following the Q4 earnings call, it’s clear that supply-chain problems are its biggest problem, however. This is not unique to the EV sector by any means. During Tesla’s (NASDAQ:TSLA) recent earnings call, CEO Elon Musk also noted the constraints that shortages pose. Unlike Rivian, though, Tesla has not issued plans to scale back production.
Is this decline a buy-the-dip opportunity? Let’s take a closer look at what some experts are saying about RIVN stock.
Rivian Price Predictions: Is RIVN Stock a Buy?
- To start, John Murphy of BofA Securities has been bullish on RIVN stock for months, still considering it a “buy.” The analyst states that his rating is “predicated on our view that the company is one of the most viable among the start-up EV automakers and also a relative competitive threat to incumbent automakers (and possibly to other automotive-related verticals).” Murphy adds that “the competitive landscape for electric vehicles is fierce” but asserts that “RIVN has more pieces in place and in progress than most EV OEM peers.”
- Rod Lache of Wolfe Research recently lowered his RIVN stock price target from $130 to $78 per share. Like Murphy, however, Lache maintains a “buy” rating. The analyst says that investors “need to look 5-years out (the company will likely have at least 3- plants, with 800,000 units of capacity in this timeframe).” While Lache admits Rivian needs to build momentum, the analyst still sees potential as its “production cadence accelerates through 2022 and into 2023.”
- Finally, Wedbush’s Dan Ives — a respected voice within the EV sector — also maintains a “buy” rating for RIVN stock, remaining overall bullish. Ives says “the Rivian story has been a bad episode out of the Twilight Zone” since its IPO. The analyst attributes Rivian’s woes to “supply-chain problems, price increases, price cuts and weak guidance.” Although Ives slashed his price target from $130 t0 $60, the analyst still thinks Rivian’s problems are fixable.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
