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Rivian stock gets double downgraded after Q4 earnings

By: Invezz
rivian stock double downgraded after q4 earnings

Rivian Automotive Inc (NASDAQ: RIVN) is down another 10% on Friday after a UBS analyst double downgraded the EV maker to “sell”.

Rivian stock could tank another 20%

Joseph Spak trimmed his price objective on the electric vehicles company as well from $24 to $8.0 which suggests another 20% downside from here.

His super bearish call arrives only days after $RIVN came in well short of analysts’ forecast for full-year production.

A rapidly changing EV backdrop causes us to reassess our demand view and makes Rivian’s current strategy quite onerous on the ramp to profitability and cash flow.

With sales of costlier electric cars cooling, Rivian CEO RJ Scaringe is going to woo consumers with a smaller SUV and a smaller $45,000 price tag.

Read more:

— Forbes (@Forbes) February 23, 2024

The Nasdaq-listed firm has lost nearly 30% over the past three days even though it did beat Street estimates in its recently concluded quarter as Invezz reported here.

Rivian is a cash burning company

Joseph Spak is concerned that Rivian Automotive Inc may fail to meet its gross profit and EBITDA guidance for 2024.

Watch here:

He expects the Irvine-headquartered firm to now take longer than previously expected to break even on free cash flow and EBITDA. UBS analyst recommends against owning Rivian stock primarily because it’s a “loss making and cash burning company”.

Note that $RIVN did also announce plans of lowering its headcount by some 10% this week.  

Among other investment firms that have recently downgraded Rivian shares is JPMorgan that now rates them at “underweight”. Its $11 price target still suggests an 8.0% upside from here, though.

The post Rivian stock gets double downgraded after Q4 earnings appeared first on Invezz

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