Rivian seen as "one of the core EV players over the next decade"

September 12, 2023

EV maker Rivian (RIVN) is seen as “one of the core EV players over the next decade,” according to Wedbush Analyst Dan Ives.

Rivian shattered analyst expectations in the second quarter, delivering 12,640 vehicles (analysts were forecasting around 11K), up 50% from the previous quarter.

While production continues climbing, with nearly 14K EVs built during the period, Rivian’s CEO RJ Scaringe highlighted the company’s improving profitability and capital efficiency.

As Rivian builds more vehicles, the company is enhancing its ability to optimize plant overhead and manufacturing operations. By adding in-house components like its new Enduro drive trains and LFP battery packs, Rivian is reducing the costs of each vehicle produced.

For example, Rivian’s gross profit per vehicle improved by $35,000 in Q2 compared to the first quarter. Rivian’s gross loss per vehicle is now (-$32,595) compared to (-$67,329) in Q1 and (-$157,000) last year.

Due to the improvements in Q2, Rivian raised its annual production guidance by 2,000, with a new goal of building 52,000 vehicles by the end of the year, more than doubling from last year (24,337).

Will Rivian be a core EV player over the next decade?

The improvements were enough for Wedbush Analyst Dan Ives, known for his Tesla coverage, to say he sees Rivian as “one of the core EV players over the next decade.”

Ives said (via Investors Business Daily) that the EV maker took “another step in the right direction” after releasing second-quarter results this week. He added that “demand looks strong” and “visibility is improving into 2024.”

After Rivian topped delivery and production estimates in July, the analyst raised his price target from $25 to $30 per share.

In a separate interview with Bloomberg TV, CEO RJ Scaringe, said, “The focus of the business is incredibly dialed in on driving up production and driving down cost,” adding, “We have a very clear line of sight” to profitability.

Scaringe said he doesn’t see the need to raise capital before the end of 2025, despite several big projects coming up. For example, Rivian is opening a new $5B facility in Georgia, where it will build its R2 products.

Following a three-month rally, Rivian stock is down 16%. Although share prices are still up 25% in 2023, Rivian’s stock is still down 87% from its all-time highs set shortly after going public in November 2021.

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Rivian seen as "one of the core EV players over the next decade"