Rivian (NASDAQ: RIVN) inventory is down 45 p.c since its preliminary public providing in November when shares began publicly buying and selling at round $106.75. At present, Rivian shares hover across the $55 mark. Its drastic fall within the first few months of being publicly traded just isn’t preserving Morgan Stanley’s Adam Jonas from shying away from an extremely bullish place, stating it’s going to surge round 160 p.c from its present “overly depressed” ranges.
On the time of writing, Rivian shares had been buying and selling at $55.24.
Rivian had all the benefits an up-and-coming automaker would need. It has a savvy CEO, a sizeable funding backed by Amazon, one of many largest corporations globally, and a line of merchandise that had shoppers thirsty for extra info. The COVID-19 pandemic pushed the corporate’s preliminary manufacturing dates again a number of instances. After a 12 months of delays, Rivian began delivering the R1T pickup late final 12 months.
Rivian ends 2021 with 1,015 automobiles produced, COO retires from firm
By way of its inventory efficiency, issues haven’t gone in line with plan. Rivian peaked at ranges simply shy of $180 per share, fed largely by analyst narratives that pushed the corporate as “the following huge factor” within the sector. Nevertheless, EV manufacturing is proving more and more tough for a lot of automakers. Lengthy-standing OEMs like Volkswagen and GM have struggled in early initiatives, and startups like Rivian and Lucid are yielding numbers which are simply fractional in comparison with business leaders Tesla.
Nevertheless, Tesla’s manufacturing historical past additionally confirmed lagging durations early on, solely to iron out the bottlenecks and change into the most important producer of EVs, ramping to over 900,000 annual items fourteen years after producing its first mannequin.
Jonas, who has lined the EV sector for years, says if any auto firm can dig itself out of the depths, it’s Rivian.
Credit score: MotorTrend
“An IPO that preceded the December market prime, the reality-check of provide chain bottlenecks (regular in auto land, maybe not regular in tech land), and the gut-check of getting accomplice Amazon train its proper to safe EDVs from various distributors (Stellantis, Daimler) has shaken investor confidence and, we predict, gives a superb alternative to achieve publicity to an organization, product cycle, and enterprise mannequin that we imagine has a higher likelihood [of] being a winner on this business than most different EV rivals,” Jonas wrote in a be aware to traders. “Whereas Rivian is at a far earlier stage in its industrial journey than Tesla, we don’t see this firm as only a ‘idea inventory’ both. The street to ramping manufacturing shall be uneven, however we anticipate largely attributable to provide fairly than demand.”
Rivian shares spiked briefly earlier this week following stories of a rise in manufacturing output of the R1T. Rivian was unable to touch upon the matter once we requested for clarification. The routine sell-off of tech shares this week has additionally probably contributed to Rivian’s sharp fall. In spite of everything, Tesla’s spectacular This autumn 2021 Earnings Name didn’t yield any positive aspects in the best way of the business chief, as the corporate’s inventory is down practically 8% this week.
Jonas holds a $147 value goal for Rivian, with a “Purchase” ranking. Jonas is ranked 656th, out of seven,760 analysts. He has successful fee of 52% with a median return of 11.4%, in line with TipRanks.
Disclosure: Joey Klender just isn’t a RIVN Shareholder.
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